First some disclaimers - I'm not an attorney; and I haven't had direct involvement with these deals since, maybe, 1989 (4 banks ago). However...
Here is a link to the state statute. If you're an FICC member, News 87-9 and 88-1 have good references.
Short story - these are considered to be revocable trusts. The advice is to report earnings via 1099s in the name of the contract buyer (who may or may not be the contract beneficiary). So you need to get the TIN of the contract buyer in order to do your tax reporting.
From a privacy standpoint, I think you'll have the flexibility to determine identification procedures for this specific account type, which will obviously be different than those you'd take to open a standard checking account. Just specify what ID steps you'll take in your procedures, and you should be fine.
We'll know more when the CIP rules are ultimately released.