I'm looking for some direction on these - do any of you have follow-up procedures for temp. cards? In most cases, the reason for the "temp" status is that we're waiting for some piece of information not provided at the time of account opening. We'd like to institute a policy that would spur either the customer or the branch to provide/get the information in a timely way. We don't have any sort of tracking mechanism, so it's all done manually - as people remember they didn't get the card back - or by a message placed on the account. Some banks are talking about either closing the account w/in a certain timeframe or putting a hold on the funds until the card is returned. Any other thoughts out there? Thanks.

In every institution that I have worked in that utilized temporary signature cards, I have recommended that they be discontinued. If you don't have all the information, why open the account? Additionally, it usually flies in the face of one of the following; know your customer, AML, BSA, legal requirements, etc.

I worked at one bank that pended for signatures of other parties on the account that were not present at the time of account opening. They opened the accounts, ordered checks, gave them a signature card to take home to get signed and return - I can't tell you how many accounts there were without proper specimen signatures. Tracking is huge issue - it's just not worth it IMHO.

I agree, but somehow that'll go over like a huge lead balloon and may be hard to enforce . But -- I'm interested in hearing how others have handled it.

When our new account staff opens an account with missing signatures, they place a certain "status code" on the account. Once a month a report is generated for each branch with a list of all the temp cards.
That branch is responsible for contacting the customer and getting a completed card. If there is a temp card on that list that is more than 90 days old, that would be an audit exception for them.
Customers that will not send in completed sig. cards are informed that we would have no choice but to close the account - that usually produces a completed card.

When a customer takes a signature card out of the bank to get the other person(s) signature(s), we require that the other signature(s) be notarized. We do not want the customer sitting out in the parking lot signing someone else's name just so they can get the card back to us.

I think that there can be specific situations in which a "temporary" card can be used; however, we should develop a specific policy and procedures to prevent too much creativity in the process.

New Customers - I can't imagine a sitation where a temporary card would be appropriate for a new customer.

Existing Customers - Customers with established relationships may want to open an additional account when one of the parties is not present. We could have two options. 1) prepare the new account card as an individual account and prepare replacement joint account cards. When the customer returns with the replacement account, verify the signature (they are already existing customers-right?!), then maintenance the account to add the joint owner. 2) With supervisor approval, establish the joint account, keep the one card signed by the individual present and allow the second card to leave for signature. Establish appropriate 7, 10, 14 day follow up procedures to insure missing card is returned. Verify signature upon return. If card is not returned with XX days, maintenance to individual account.

No one ever said going the extra mile wasn't a headache! But if we design our controls, we can probably get by. We just need to make sure these are exceptions and not the rule!

Just a few thoughts!

Thanks so much for the suggestions - I truly appreciate getting the "best of the best" out here! We've tried to encourage the branches to set up individual accounts first (if the other party isn't there) but old habits die hard, and they're likely to put both names there. I like the suggestion about the existing customer vs. the new customer. You all are terrific! Happy Friday!

As a side note, the uncoming CIP requirements may give you more ammunition in your efforts to stop that process.

That's what we're anticipating as well, but Sr. Management wants something concrete NOW. We'll be sure the cement hasn't hardened so it can be updated when the CIP is defined.