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#1955170 - 08/20/14 03:54 PM Expired DL prior to loan closing
bstritecky Offline
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Joined: Feb 2005
Posts: 313
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Audit has written up the mortgage dept based on the following:

application May 15th. CIP completed at that time will valid identification. Loan closed August 14th and driver's license has expired.

FFIEC Guidance states CIP must be done before account is opened. Mortgage is saying they did CIP.

How are others handling this???

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#1955205 - 08/20/14 04:35 PM Re: Expired DL prior to loan closing bstritecky
Elwood P. Dowd Offline
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Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
So, audit is alleging:
1) CIP was not performed or
2) CIP should be performed twice or
3) the customer's identity might have changed between application and closing?

My reaction is that the specific language in your CIP will determine whether there is an issue, but the reg is satisfied.
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#1955206 - 08/20/14 04:37 PM Re: Expired DL prior to loan closing bstritecky
Local banker Offline
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Joined: Feb 2008
Posts: 129
I would check your bank's policy. It's probably one of those "best practices".

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#1955240 - 08/20/14 05:07 PM Re: Expired DL prior to loan closing bstritecky
edAudit Offline
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edAudit
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Posts: 4,796
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Is it a CIP issue or a basic IDing you customer issue?

Most banks will not close a loan with an expired ID for Operational/Policy reasons.

FWIW the customer was CIPed 3 months prior to the loan closing why would the closer accept expired ID or did they not check the ID at closing and just used what is in the file?

It is not the the customers identity has changed; just that the person standing in front of the closer is in fact the person who is on the ID.
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#1955446 - 08/20/14 07:59 PM Re: Expired DL prior to loan closing bstritecky
John Burnett Offline
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John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
The most I see here is a possible self-inflicted wound if the bank's policy and procedures call for verification of current photo ID by the settlement agent or closing representative. As noted, the CIP piece appears to have been taken care of; the problem is procedural.

If the policy/procedure says that ID is to be verified by (as opposed to at) closing, there is not a problem.
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