CIP

Customer Identification Program

A requirement under the Bank Secrecy Act (BSA) and the USA PATRIOT Act that obligates financial institutions to verify the identity of their customers and maintain records of the information used to verify their identity. The purpose of CIP is to prevent financial crimes such as money laundering, terrorist financing, and identity theft by ensuring that financial institutions know their customers and can detect suspicious activities. Under CIP, financial institutions must obtain and verify certain information from their customers when opening an account, such as:

• Name
• Date of birth
• Address
• Identification number (e.g., Social Security number (SSN), taxpayer identification number (TIN), or passport number)

Financial institutions must also implement risk-based procedures to verify the identity of their customers, such as:

1. Verifying the customer’s identity using documents, non-documentary methods, or a combination of both.
2. Checking the customer’s name against government lists of known or suspected terrorists or terrorist organizations.
3. Determining whether the customer appears to be acting on behalf of another person or entity and, if so, obtaining information about the person or entity.

Financial institutions must maintain records of the information obtained during the CIP process, including:

1. Identifying information provided by the customer
2. Description of the documents used to verify the customer’s identity
3. Description of the non-documentary methods and results used to verify the customer’s identity
4. Description of the resolution of any discrepancies in the identifying information

CIP requirements apply to various financial institutions, including banks, credit unions, broker-dealers, mutual funds, futures commission merchants, and introducing brokers. Failure to comply can result in civil and criminal penalties, including fines and imprisonment.

• Abbreviation: CIP

Additional Acronyms for CIP

• CIP - Customer Insights Platform