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#2138000 - 07/13/17 06:51 PM CIP for POA
Compliance Action Subscriber 1226 Offline
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We opened a new account that has a Power of Attorney - Is it a requirement to CIP the person that has Power of Attorney

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#2138013 - 07/13/17 07:19 PM Re: CIP for POA Compliance Action Subscriber 1226
BrianC Offline
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BrianC
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Illinois
The CIP FAQ's note that the attorney-in-fact may or may not meet the definition of "customer " depending on whether or not the grantor has legal capacity.

1. Who is the “customer” when an account is opened by an individual who has power-of- attorney for a competent person who is the named owner of the account?
The CIP rule provides that a “customer” generally is “a person that opens a new account.” 31 C.F.R. § 103.121(a)(3)(i)(A). When an account is opened by an individual who has power-of-attorney for a competent person, the individual with a power-of-attorney is merely an agent acting on behalf of the person that opens the account. Therefore, the “customer” will be the named owner of the account rather than the individual with a power-of-attorney over the account. By contrast, an individual with power-of-attorney will be the “customer” if the account is opened for a person who lacks legal capacity.

You should also look to your own procedures. If they state that the Bank will consider the attorney-in-fact as a customer in all circumstances, then you must follow your own procedures even if they are more restrictive than the regulation.
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#2138060 - 07/13/17 10:50 PM Re: CIP for POA Compliance Action Subscriber 1226
TryingtoComply Online
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The West
If your CIP procedures do not address this, consider adding clarification so that Bank employees are consistent.
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#2138129 - 07/14/17 03:27 PM Re: CIP for POA BrianC
John Burnett Offline
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Cape Cod
Originally Posted By BrianC

You should also look to your own procedures. If they state that the Bank will consider the attorney-in-fact as a customer in all circumstances, then you must follow your own procedures even if they are more restrictive than the regulation.


However, don't make the mistake of applying your CIP process only to the attorney-in-fact/agent if he or she is opening the account on behalf of a competent principal. In such a case, if your procedures call for CIP'ing the agent, you must do that to comply with your procedures, but the customer that you MUST CIP under the regulation is the competent principal.
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#2234529 - 04/09/20 06:46 PM Re: CIP for POA Compliance Action Subscriber 1226
IronP2717 Offline
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Should the determination of incompetency of the principal at a later date then trigger the bank to CIP the POA/agent if they were not previously CIP’d?

Yes. We would rely on a legal determination of incompetency and not our own judgment on the matter of competency.

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#2234655 - 04/13/20 03:17 PM Re: CIP for POA Compliance Action Subscriber 1226
John Burnett Offline
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If there is an AIF on a competent principal's account and the principal becomes incompetent, the account relationship changes and I think it would be wise to apply CIP to the AIF as soon as possible after the adjudication of incompetence.
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