I have a contact at a bank that contracts with Upstart loans and they are wondering what BSA needs to do with these loans. The loan funds go into a GL and the applicants are considered the Banks customer. The issue is how do you monitor anything with these loans? The Bank gets a list of loans opened in their name but not a whole lot of info that would help BSA. Upstart and the Banks CIP procedures don't exactly match-up either. I was thinking the Bank could request CIP samples from Upstart for these loan customers. The Bank also does not have anything in their BSA P&P regarding these loans. Beyond adding Upstart to their P&P and requesting customer CIP samples monthly I'm curious if anyone has experience with these types of loans and what you do? They will have an FDIC audit in a few months so the pressure is on.

Thank you in advance!

What is an "Upstart Loan"?

Upstart is a FinTech company. These loans are opened online. Taken from Wikipedia "Upstart is an AI lending platform that partners with banks and credit unions to provide consumer loans using non-traditional variables, such as education and employment, to predict creditworthiness"

Then I assume you would just treat these like any other indirect loans that you might make.

That's a good point. My bank and the bank in question are very small community banks that don't normally have products like this. My bank has secondary mortgages but that's about it. We control the CIP gathering process, not the third party. We manually run 314a on these as well. In the case of the other Bank and Upstart, this is the first product of this kind to be introduced and unfortunately there was no acting BSA Officer there at the time of product implementation (go figure). So in all honestly, we are trying to figure out what to do period.

This is a learning experience that I am happy to be apart of for my own future so I certainly appreciate your responses.