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#32525 - 09/12/02 07:46 PM CIP and Existing Customers
Anonymous
Unregistered

We HAD our first meetings on the CIP and needless to say there were lots of opinions voiced. Our deposit folks are reading the regulation to indicate that when an existing customer opens a new product, it is NOT necessary to obtain a copy of any identification if, in your previous procedure you viewed the ID documents and recorded the number. They contend it is NOT necessary to retain a copy of the ID. Their position is based on the fact that the regulation addresses a risk based approach. Though I think this would be great, I read the regulation as requiring that you comply with the provisions of the new regulation meaning that you obtain a copy of the ID (one time) and keep it on file. Is my interpretation consistent with the way you interpret the CIP as it stands or is theirs?

Thanks

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General Discussion
#32526 - 09/12/02 07:51 PM Re: CIP and Existing Customers
JacF Offline

Power Poster
Joined: Nov 2001
Posts: 6,719
PA
I stand behind your interpretation on this issue. Their thinking on previous verification is overlooking the phrase in the CIP rules that states the prior verification must have been done according to these rules in order to exempt future verifications.

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#32527 - 09/12/02 08:26 PM Re: CIP and Existing Customers
Tina A Sweet Offline
Diamond Poster
Tina A Sweet
Joined: Aug 2001
Posts: 1,033
Marysville, Ca.
You are correct. If your prior program required photocopies and your procedures are the same, you would be in line with the CIP requirements. However, I would doubt they are so you would need to complete the transactions as per the new CIP requirements.
_________________________
Tina A Sweet-Williams
AVP Special Assets
mailto:tsweet@goldcountrynb.com

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#32528 - 09/12/02 08:48 PM Re: CIP and Existing Customers
ahou Offline
Power Poster
ahou
Joined: Aug 2002
Posts: 3,094
Ditto - if you did not obtain photocopies of IDs on your existing customers (as we did not!), you will have to when they open a new account or are added as a signatory. That said, many comment letters asked for clarification on this issue. Maybe they will give us a break .....or maybe not.
_________________________
Opinions are my own and not of my employer.

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#32529 - 09/12/02 09:10 PM Re: CIP and Existing Customers
Rangers Fan Offline
Gold Star
Rangers Fan
Joined: Dec 2001
Posts: 345
And how would you be able the justify the "risk based" approach if you didn't have proof you verified identity? That hard copy stuff sure would be nice. We just had our first meeting too, and joy oh joy, aren't these fun? How much pain medication have you had to take after working on your written CIP? It is hard trying to convince folks we will need to get ID from their customers who have been banking here since before some of us were even born.

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#32530 - 09/12/02 09:23 PM Re: CIP and Existing Customers
Lestie G Offline

Power Poster
Joined: May 2002
Posts: 3,608
Near the Land of Enchantment
I asked my committee to read some selected BOL articles, and the OCC issuance of the proposed rule before the first meeting. They did (surprisingly) and sat wide-eyed during the whole meeting, agreeing with everything I said, and even suggesting that we put more in the program than I was suggesting! I think they finally realized that I don't make this stuff up - it's real and it's serious.

I think that's probably my one break for the year - I'm trying to enjoy it to the fullest!!
_________________________
Opinions my own.

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#32531 - 09/12/02 09:28 PM Re: CIP and Existing Customers
Rangers Fan Offline
Gold Star
Rangers Fan
Joined: Dec 2001
Posts: 345
And where might I purchase whatever illegal ingredient you slipped them before the meeting????

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#32532 - 09/12/02 10:32 PM Re: CIP and Existing Customers
SMQ, CRCM Offline
Power Poster
SMQ, CRCM
Joined: Apr 2001
Posts: 4,828
Between the lines
I did the same as lglover. I sent out the cover letter from the Treasury, the summary, and the proposal along with a couple of sample policies and other snipets of info. They grumbled alot about having another meeting and having to read the material. But come meeting time, we were all on the same page and everyone was very agreeable. Just finished my procedures Next step, board approval!

I also mentioned this today at loan committee, ouch, I think I am going to send the lenders the same info. before I give them our new procedures.
_________________________
NOLA is my Beach!

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#32533 - 09/13/02 01:06 PM Re: CIP and Existing Customers
waldensouth Offline
Power Poster
waldensouth
Joined: Nov 2001
Posts: 7,983
FINALLY ABOVE the gnat line
I've been conducting training all week on our new Georgia Fair Lending act AND the Customer Identification Program. I realize it isn't final yet, but our employees deserve more than a 1 day notice to totally change the way they do things. I made them promise they wouldn't take the CIP to the board until I gave the word because it could change. The good this about covering this with staff is that they thought of several situations that I had not covered. We can improve this over the course of the next month, until the final reg is issued. My CSRs and Loan officers will have the opportunity to make it "their" regulation with the imput generated from training.
_________________________
"Once you learn to read, you will be forever free."

- Frederick Douglass




My Opinion Only.

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#32534 - 09/16/02 12:45 PM Re: CIP and Existing Customers
ABirkla Offline
100 Club
ABirkla
Joined: May 2002
Posts: 103
I told our deposit and loan departments the same thing. Then I started thinking about the risk based approach. If you have customers of the institution that have banking relationships with you in excess of 20 years, how much risk is involved with that customer? We do not have a copy of their identification but if we ask now, it doesn't matter if we blame it on the government or not, all _ _ _ _ will break loose!
_________________________
Thank You

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#32535 - 09/16/02 07:26 PM Re: CIP and Existing Customers
Tberry Offline
Member
Tberry
Joined: Mar 2002
Posts: 84
Kansas
I am also in the process of doing CIP training in all branches. We will not have a board meeting for approving the addition of CIP to the BSA until after the 25th but the minimum requirements will be in place by the 25th. If they give us breathing room so much the better. I have taken the stance that we have already identified all our loan customers that we have at least one of the following three on: credit report, financial statement, or tax return. All current deposit account customers will need to be identified as they make changes to their current accounts or open new ones.

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