Our policy currently requires that accounts be opened in person with CIP being conducted in person but there are many banks that open accounts on-line and in other ways and we are also considering this but I wanted to see how CIP can be completed when we are not having a face-to-face meeting with the customer, comparing the photo on the primary ID document to the person sitting on the other side of the desk, etc. A few years ago we were cited for a violation by the examiners since we had accounts opened by our overseas parent bank for customers of theirs who never actually came to the US to visit one of our local branches to complete CIP and we are naturally cautious when considering this change now. Any suggestions would be appreciated.

I recently left a bank in the midst of considering this only to come to a bank that is figuring out how to implement it. My previous bank was looking at services that ask those specfic multiple choice questions(like, an address that you lived at and one or none of the addresses might be correct) in addition to the customer scanning their ID. Is that enough? I don't know. I didn't think so, but that's more of a gut feeling than anything.

The other issue for me was based around the OCC's MLR and how to record accounts opened by mail/phone/computer. I had a couple questions for the OCC, but never got the chance to ask. Namely,

1. What counts as an account opened online? If the customer has to physically come into the bank and see a CSR (so that the CSR can compare documentation to the customer) before the account can be funded, is it still considered to be opened online?

I don't suppose any of this will help. I've not heard what my new bank is considering. Personally, I hate the whole idea.

I've been at banks which allow for mail/phone account opening, with the caveat that a notarized copy of the required CIP verification documents accompany the opening deposit.

I worked at a Bank for a long time that most account opening by mail until we switched to online.

The vendor we had for online account opening offered several products that could be used for verification. Our system ran ChexSystems on the individual, then the Equifax ID checker product which asked multiple choice questions like was mentioned above and it did an OFAC check. We also had an ACH funding process which required account verification prior to the account funding transaction.

For both Chex and Equifax we were able to set criteria of what would be considered, a pass, fail or review. We had special procedures for dealing with applications which received a review. Both are auditors and our regulators were happy with our process.

We also did not have any fraudulent accounts receive an automatic pass all either failed or went to review status.

It was a lot of work to set up the system correctly and to deal with the applications which came in online but it fit our main business model so it was worth the extra work

Kitty, out of curiosity who was your regulator at the time?

The first exam we had with the online account opening system was our last OTS exam. They looked at everything and were happy with it. Our first OCC exam barely looked at BSA. Our second exam with the OCC put BSA under a microscope and the examiner invented some new BSA requirements during the exam. But the examiner had no issues with the online account opening CIP.