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#2182965 - 06/25/18 03:58 PM
Expected activity ranges for personal accounts?
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Gold Star
Joined: Dec 2010
Posts: 261
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Is it common to obtain the expected activity ranges for personal accounts when opening the account? We currently only do this for business accounts, but I'm curious if I should start for personal accounts as well.
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#2182966 - 06/25/18 04:04 PM
Re: Expected activity ranges for personal accounts?
J_G
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Platinum Poster
Joined: Apr 2014
Posts: 682
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Our AML system lets us set expected behaviors for personal accounts and it helps me a lot. We have set global general behaviors in the system, but we can change them at any time.
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Define Success on your own terms, achieve it by your own rules, and build a life you are proud of. Anne Sweeney
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#2182974 - 06/25/18 04:26 PM
Re: Expected activity ranges for personal accounts?
J_G
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10K Club
Joined: Jul 2001
Posts: 83,405
Galveston, TX
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Nothing like creating additional work.
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The opinions expressed here should not be construed to be those of my employer: PPDocs.com
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#2182983 - 06/25/18 04:46 PM
Re: Expected activity ranges for personal accounts?
J_G
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Platinum Poster
Joined: Feb 2010
Posts: 960
Illinois
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I know of two banks that were pushed hard by the OCC in the Central District to collect this info at account opening. It is of marginal value on your typical household accounts and the customers don't like it.
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#2182985 - 06/25/18 04:54 PM
Re: Expected activity ranges for personal accounts?
J_G
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10K Club
Joined: Oct 2000
Posts: 10,180
Toano, VA
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Are there ways to use this additional behavioral data for marketing purposes? Upsales? Add-on services? Product development?
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#2182988 - 06/25/18 05:01 PM
Re: Expected activity ranges for personal accounts?
J_G
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10K Club
Joined: Jul 2001
Posts: 83,405
Galveston, TX
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Yes - I know, but I would not do it voluntarily and if a regulator insisted, only after I lost any appeal process. Unless you are dealing with higher risk individuals, like NRAs, it is a exercise in futility. What are you really going to do with the information and as MBH said, customers are not going to like it. Having this information on every little old lady that only gets SSI checks - is it really worth it? Maybe if you have some generic standard CDD questions, like do you plan to do wire transfers, asking them about volumes might come next. But it is like BO information - if someone doesn't want to tell you what they are going to be doing - they will lie. If they do something unusual, your AML monitoring should already pick that up on a new account.
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The opinions expressed here should not be construed to be those of my employer: PPDocs.com
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#2182991 - 06/25/18 05:23 PM
Re: Expected activity ranges for personal accounts?
J_G
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Power Poster
Joined: Jul 2006
Posts: 4,351
New York City
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We are regional bank who was forced to do this for our consumer retail accounts. There is minimal value and it absolutely creates additional work which drives up the cost of the AML Department. However, there really isn't much you can do to push back. SRs are handed out like candy in my area and regulators don't think twice about forcing banks to due additional, low value work for AML in my area.
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#2183022 - 06/25/18 06:51 PM
Re: Expected activity ranges for personal accounts?
J_G
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Diamond Poster
Joined: Apr 2013
Posts: 2,211
The West
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This information is included in our KYC Questionnaire that we complete interview style at account opening. We have several questions in our KYCQ that help us to identify the sources of income, and PEP status.
I honestly believe that the collection of this information is dependent on your banks profile. We are a business bank and our customers activities are well outside what you would see for a normal consumer with respect to ACH, wire, and even cash and debit card activity.
I think it would be stupid to collect this information if you were a small retail community bank or credit union; however, for a bank like ours it actually does make some sense and having the information has proven useful.
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#2183182 - 06/26/18 05:36 PM
Re: Expected activity ranges for personal accounts?
MyBrainHurts
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Power Poster
Joined: Jun 2001
Posts: 8,272
Where the heart is
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I know of two banks that were pushed hard by the OCC in the Central District to collect this info at account opening. It is of marginal value on your typical household accounts and the customers don't like it. The OCC in the Western District imposed this requirement about 6 years ago. I see no value to it as most BSA systems can detect unusual patterns in a consumer's account. If someone is getting direct deposits of their paycheck, why would it matter if one week they made 5 withdrawals from an ATM, and the next week they didn't make any withdrawals? And why do I need to contact my customer if they get a direct deposit from their employer at or near year-end that is slightly larger than their usual deposit? Do I really need to pester my customer and ask if they got a year-end bonus? Per the OCC, and I will quote "Yes." Head.Desk.Thump.
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CRCM,CAMS Regulations are a poor substitute for ethics. Just sayin'
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#2183366 - 06/27/18 07:22 PM
Re: Expected activity ranges for personal accounts?
J_G
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Gold Star
Joined: Apr 2009
Posts: 450
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If this ever comes up again, show the auditor or examiner this little gem from the new FFIEC Exam Manual CDD Chapter (Page 3): The bank should gather sufficient information about the customer to form an understanding of the nature and purpose of customer relationships at the time of account opening. This understanding may be based on assessments of individual customers or on categories of customers. An understanding based on “categories of customers†means that for certain lower-risk customers, the bank’s understanding of the nature and purpose of a customer relationship can be developed by inherent or self-evident information such as the type of customer, the type of account opened, or the service or product offered.
Last edited by Pat Patriot Act; 06/27/18 07:32 PM.
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