If you aren't pull credit reports on these individuals and they have an outstanding IRS lien, you just made them an unsecured loan, because getting the CD released from the grips of the IRS is going to cost you more time and money than it probably is worth.
Assuming management considers the risk low...small bank, loyal customers. And these loans are small, short term, few and far between, because who ties up large amounts of money at a bank where the return is practically nil.