I previously posted my questions as a reply under one for restricting account use. I need to start it as a new post. Here goes.
1. Lets say all information provided has been verified under our CIP Program, except the customer is applying for a TIN. We obtain proof of the application for a TIN. We conduct our risk based analysis and open the loan. Now, if after a reasonable period of time, the customer has not produced the TIN, aren't we required to close the account? How do we close a loan account?
2. Also, please help me understand the definition of "signatory". I have read and re-read the threads covering this, but I am still confused. Co-applicants, co-signers, guarantors(?), co-makers, are covered. Does signatory only apply to those authorized under a corporate resolution, or similar dicument, to conduct transactions for a business?
3. Just curious - If readers would be so kind as to respond - I'd like to survey as to how many banks are going to use an outside vendor for ID verification, vs leaving it to the subjectivity of the account servicer. Could you also give me your approximate asset size? NOTE: I'm not asking for the name of the vendor(unless you are comfortable in disclosing). Thanks everyone.

1. Do you really want to loan $30,000 to someone you haven't verified the ID on? The answer is you don't close a loan without ID confirmation. On the deposit side, you simply close the account if needed.

2. My focus to date is on the deposit side where they are better defined/understood. On loans, we'll CIP all primary borrowers and other signers just out of underwriting practices.

3. Dunno yet, but doubt we'd outsource it. Vendors may provide tools we use, but we'll do the work.

Good questions. I'll try to get the ball rolling.

1. That is why I wouldn't make a loan w/o a TIN. Opening a deposit account is one thing, but a loan (as you are pointing out) is a whole different issue. I can't see calling a loan - or how I would call the loan - b/c of a missing TIN.

2. I understand your confusion on signatories. I suggest you read §103.121(b)(2)(i)(B) and page 19 (of the Adobe file) of the section by section analysis. I think co-applicants, co-signers and comakers are NOT signatories as they are borrowers. A guarantor though is not an owner/borrower, so the signatory exemption applies.

3. I'm not a banker so I can't answer.

1. We will require a TIN or for a non-us citizen one of the approriate alternative numbers. We will require a copy of ids used if they are not a us citizen.
2. We will verify all signers to an account.

3. Yes, we will most likely go with a vendor for batch processing on a nightly basis. We are currently verfing id on the front line by requiring check systems, credit reports etc. We believe our current system (we already get, name, address, TIN (or other) and DOB) with the additional back verification will provide us with reasonable belief.

1. I am with the 'no TIN- no loan' camp. But this brings me to a new question, as I am not in lending: Would refusing a loan based on the absence of a TIN constitute adverse action, or is this considered an incomplete application?
2. I prefer to CIP 'em all. After all, these are the people you are may need to count on to repay the debt, so it's best to know who they are and where to find them.
3. We are using a positive id service, and will continue to do so.

Thanks to all for your responses to date. I agree, no TIN, no loan. It's going to be a reality check for commercial lenders. Its my understanding that we can reject an individual for "Unable to verify Identity". If an outside vendor was used in the process, we would check the box on NAA "Our credit decision was based in whole or in part on information from an outside source, etc". Obviously, if a credit report had also been used, the NAA would include those reasons for rejection (if applicable) and the proper disclosure.

We are looking at several integrated CIP solutions. I am trying to absolutely minimize the risk in our bank by putting every customer through analysis, and taking the subjectivity away from the employee.

I would consider it an incomplete application.

The announcement yesterday from the IRS that they will issue EINs immediately on line should help you sell no TIN, no loan to your lenders. There really is no reason not to have a TIN by the time the loan closes.

Thanks.

oops that link did not work. this one works.
www.irs.gov/businesses/small/article/0,,id=102767,00.html
this is the article that has a link that says apply online now. that link takes you directly to the SS4

Thanks anyway, I just did the search.