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#618049 - 09/26/06 06:56 PM Opening new accts online, new client
Bacon Boy Offline
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What practices are other banks implementing when offering new accounts on your websites? We're examining this option, but aren't sure how to properly ID the new client. Any suggestions/guidance would be thoroughly appreciated. Thxxx!
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eBanking / Technology
#618050 - 09/26/06 06:51 PM Re: Opening new accts online, new client
Skittles Online
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Sorry - but if someone is a 'new' customer and attempts to open an account on-line they must go to one of our locations before it is actually opened for CIP verification.
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#618051 - 09/26/06 07:10 PM Re: Opening new accts online, new client
10ACBanker Offline
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Our practice is the same as mentioned by skittles.
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#618052 - 10/03/06 11:02 PM Re: Opening new accts online, new client
Bacon Boy Offline
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Thank you. I'd recently gone to the website of a major bank (and my former employer) and discovered that new customers to the bank were required to physically enter the branch to complete the account opening procedure. However, the bank down the street claims they can electronically verify clients.
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#618053 - 10/04/06 12:45 PM Re: Opening new accts online, new client
P*Q Offline

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I opened an account at a major bank earlier this year, mainly for the purpose of investigating how they did it. I did not have to physically go to a branch. They had an authentication process whereby I had to answer questions. I also had to send a copy of my license and a document showing my physical address (paystub, utility bill,etc). They then mailed me the sig card and disclosures and a return envelope to send them back. That's the direction we're headed but not yet. I'm of the opinion, why offer on-line account opening if the person still has to come to the Bank. You do need to consider BSA and fraud risk but if you do enough due diligence, it shouldn't be a problem.

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#618054 - 10/05/06 04:08 PM Re: Opening new accts online, new client
Andy_Z Offline
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I think you could re-title this thread "What is your appetite for risk?" CIP in this manner scares me and I would believe you'd immediately watch the first 3 to 6 months of transactions with a close eye, possibly longer.
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#618055 - 10/09/06 01:06 PM Re: Opening new accts online, new client
DriverDan Offline
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Quote:

I opened an account at a major bank earlier this year, mainly for the purpose of investigating how they did it. I did not have to physically go to a branch. They had an authentication process whereby I had to answer questions. I also had to send a copy of my license and a document showing my physical address (paystub, utility bill,etc). They then mailed me the sig card and disclosures and a return envelope to send them back. That's the direction we're headed but not yet. I'm of the opinion, why offer on-line account opening if the person still has to come to the Bank. You do need to consider BSA and fraud risk but if you do enough due diligence, it shouldn't be a problem.



I STRONGLY recommend against allowing new accounts without the customer verifying themselves in person. It will make you a target for fraud. Do you know how long it takes to make a fake ID scan, util bill, or whatever other documentation is required? An hour, 2 hours max. With the advent of image sharing sites it's easy to get someone else's picture and put it on a modified ID scan.

To answer any questions you may have they'll pull the credit on the person's identity that they've stolen. That's where your questions will come from so they'll have all the answers.
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#618056 - 10/10/06 12:38 PM Re: Opening new accts online, new client
P*Q Offline

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I completely understand the fraud/CIP risk associated with this practice. However, when you're surrounded by "big banks" that offer this service, it's hard to make that argument to management. My job is to lay out the risks, should they choose to go ahead and offer it, it's out of my hands. Also, there are several options out there for authentication. One we're considering asks the applicant a series of questions based on a variety of public record info (versus a credit bureau which in my opinion is easier for a fraudster to obtain). The Bank sets the perameters for how many questions, a combo of which types and how many the person must answer correctly before ever getting to the application.

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#618057 - 10/14/06 05:41 AM Re: Opening new accts online, new client
Andy_Z Offline
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I was speaking with a banker at the ABA school whose bank was also getting ready to do the same thing. They were limiting it to customers residing in their market area, albeit a multi-state area. And they were going to enhance monitoring of the accounts for some months.

I agree with PQ that compliance doesn't make the decision, but recommends and reacts accordingly. Once the decision is made, figure out how to best control the risk.
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