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USA PATRIOT Act Identification Requirements
Answer by Ken Golliher, BOL Guru

Question: In regards to the Patriot Act what requirements are necessary for customer disclosure for identification requirements.

Answer: Section 103.121(b)(5) of the currently proposed regulation says: "The program must include procedures for providing bank customers with adequate notice that the bank is requesting information to verify their identity."

Your only reliable guidance on this point would come from the supplementary information accompanying the proposal: "A bank may satisfy the notice requirement by generally notifying its customers about the procedures the bank must comply with to verify their identities. For example, the bank may post a sign in its lobby or provide customers with any other form of written or oral notice. If an account is opened electronically, such as through an Internet website, the bank may also provide the notice electronically."

Your reasonable response to this might well be , "I still don't know what to do." Hopefully, that's what some of those filing comments on the proposal will tell the promulgating agencies.

There are two issues applicable to any required disclosure: timing and content. You want to know what to say and when to say it.

It would be relatively easy for me to write a disclosure that I think meets the requirements of the regulation. Absent more specific guidance in the regulation, it would be even easier for an examiner to say that my language was woefully short of the legal requirements. (They do that you know.)

Hopefully, they will come up with model language that you can rely on.

First published on 9/2/02

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