USA Patriot Act - Customer Identification PROGRAM POLICY 

Introduction

The USA PATRIOT Act (Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001) requires financial institutions to establish a Customer Identification Program.  The Customer Identification Program (CIP) must be used in conjunction with CF LA Credit Union’s Bank Secrecy Act Policy.

 Purpose

The US Treasury in conjunction with the National Credit Union Administration published broad guidelines for establishing a CIP program to allow financial institutions the flexibility to conform to the objectives of Section 326 of the USA PATRIOT Act.  The procedures outlined in the CIP are to be used only for customer identification when opening new accounts excluding all credit and loan accounts.

General Objectives

 To prevent and detect money laundering and the financing of terrorism.

 Specific Objectives 

Section 326 of the USA PATRIOT Act requires the CF LA Credit Union to establish procedures to:

• Verify the identity of any person or entity seeking to open an account at the CF LA Credit Union,

• Maintain records of the information used to verify the member identity; and

• Determine whether the person appears on any list of known or suspected terrorist or terrorist organization provided by any agency of the federal government.

 In addition to the requirements of Section 326 of the USA PATRIOT Act, the CIP program is required to include:

• Internal policies, procedures, and controls to ensure ongoing compliance

• Designation of a compliance officer

  • The CF-LA Credit Union Manager is designated as the credit union’s compliance officer.

• An ongoing training program

• An independent auditor to test the program.

 Verification of Identity

 Information Required

Each individual who establishes a new account with the CF LA Credit Union must provide the following information prior to opening the account without exception:

• Name

• Date of Birth

• Residence if different from mailing address

• For U.S. persons, a taxpayer identification number such as social security number, individual taxpayer identification number or employer identification number for business accounts.

• For non-U.S. persons, one or more of the following: a U.S. taxpayer identification number, passport number and country of issuance; alien identification card number; or number and country of issuance of any other government-issued document evidencing nationality or residence and bearing a photograph or similar safeguard.

If the account is being established for a business, the CF LA Credit Union recognizes an employer identification number may not be available at the time the account is opened. In this instance, the new member will have 30 days to provide the appropriate information. 

Any member who adds a signer to their account who is not a current member of CF-LA Credit Union will be subject to the identity verification requirements, without exception.

 For existing members, identity does not need to be verified when establishing or changing accounts if:

• The member’s identity was previously verified in accordance with the procedures outlined in this policy, or

• The employee has a reasonable belief that they know the true identity of the member.

 Verification Requirements

Section 326 of the Act states the new/existing member is required to comply with the act.  Because of the documents required to show identification, notice must be provided stating the new document requirements. A notice will be posted in the Credit Union office. 

In order to verify the identity of the new or existing member, at least one document provided must be a non-expired government issued photo identification card (Driver’s license or military ID). Any other documentation gathered from the member to verify the required information is flexible and can include social security cards, certified birth certificates, utility bills, phone bills, pay stubs, etc.

The CF LA Credit Union CU acknowledges that some new members will not have a non-expired government issued photo ID card. In those instances: 

• The new member may provide another form of photo ID in conjunction with a government issued document showing the member’s social security number or tax identification number. If the new member is a non-U.S. person, passports, immigration documents, un-expired employment authorization document, etc. are acceptable.

• If the new member does not have any form of photo ID, they may present two forms of identification. One must be government issued (social security card, passports, immigration documents, etc), and they will be asked to complete a statement that will include the name, address, phone number, place of birth, height/weight, eye/hair color, and at least 2 references.

• One reference will be a prior financial institution. If no prior financial relationship exists, the new/existing member may provide a friend or relative as a reference. The new/existing member will be asked to provide a phone number and/or address to contact the individual to verify identity.

• The other reference should be a third party who can be contacted to confirm identity. For example, employers, school counselors/teachers, clergy, etc. The new/existing member will be asked to provide phone number and/or address for contacting the individuals to verify identity.

• If the account is being established for a minor, the guardian parent must provide the forms of identification provided and a social security card for the minor child.

 Recordkeeping

The employee of the CF-LA Credit Union who opens the new account is required to photocopy each document provided. Each employee will be responsible for insuring the photocopy is clear and legible.

The photocopy of the identification will be attached to the new account documents and placed in each member’s file.  Any additional information used to verify a member’s identity must also be filed.  The member file will retain these records for at least five years after the account is closed.

NOTE: These photocopies are NOT to be included in any loan or credit file. 

Confirming Identity

It will be the responsibility of the Compliance Officer who opens or changes the account to confirm the identity of the member. The information must be confirmed within a reasonable amount of time.

• If the member provides a photo ID, the Compliance Officer will indicate on the new account documents that the photo matches the individual.

• If the member cannot provide a photo ID, the Compliance Officer will contact the references provided to confirm the information provided. The Compliance Officer will indicate they are calling pursuant to the requirement of the USA PATRIOT Act to confirm the identity of the member.

If the new/existing member cannot provide the information required at the time the account is opened or changed, the account will not be activated until the information is received from the member excluding the allowance made for accounts opened for businesses. It will be the Compliance Officer’s responsibility for check to make sure all information for a business account is received within the 30-day time frame.

 Checking Federal Terrorist or Suspected Terrorist List

The CF-LA Credit Union will regularly screen its member list for suspected or known terrorists based on lists provided by any federal government list.  Lists may include, but are not limited to:

• OFAC Blocked Countries

• OFAC’s Specially Designated Nationals & Blocked Persons (SDN List)

• Officials of OFAC Blocked Countries

• Bureau of Industry and Security produced by the Commerce Department

• OSFI Consolidated List produced by the Canadian Government and the United Nations

• All Federal Bureau of Investigations lists including Most Wanted, Top Ten Most Wanted, Seeking Information, Most Wanted Terrorists

• Non-cooperative Countries and Territories maintained by the Financial Action Task Force, Paris, France and enforced by the Organization of Economic Co-operation and Development.

• Politically Exposed Persons produced by the Department of Treasury, Federal Reserve, OCC, FDIC, OTS, and the State Department

• Any additional lists issued by the Federal Government pursuant to the USA PATRIOT Act.

All new members will be checked for inclusion on the current versions of these lists.  Updates to the OFAC list are received by the Credit Union Manager via e-mail subscription.

At a minimum, an SAR (Suspicious Activity Report) will be filed for any match that cannot be immediately confirmed as a false match. 

Training

All new employees will receive training during employee orientation. Training will be coordinated and provided by the Credit Union Manager.

 Independent Testing

The Supervisory Committee of the CF-LA Credit Union will confirm that all required information is gathered and confirmed by the Compliance Officer when the account is opened. The Supervisory Committee will also review, at least annually, that all new members are checked against government lists of known and suspected terrorists and that appropriate action is taken for any matches.