I recently read that an expired passport is an acceptable form of identification to use in getting a driver's license. So my question is, for CIP purposes, since a bank accepts a driver's license as a form of identification when opening an account, can an expired passport be used as well?

(A) Verification through documents. For a bank relying on documents, the CIP must contain procedures that set forth the documents that the bank will use. These documents may include:
(1) For an individual, unexpired government- issued identification evidencing nationality or residence and bearing a photograph or similar safeguard, such as a driver’s license or passport;

No. I suggest you call your driver's license bureau to see if the story about using an expired passport to get a DL is accurate.