BSA/AML Customer Identification Program and Due Diligence Basics

• Overview
• Credits

Understand the procedural issues for compliance and areas of risk for enhanced due diligence.This material will provide an overview of BSA/AML/Know Your Customer (KYC) components, including the Customer Identification Program (CIP) and beneficial owner Customer Due Diligence (CDD) Rule. We will cover key definitions and procedural issues for compliance and highlight areas of risk for enhanced due diligence. Finally, we will discuss issues experienced during the pandemic, including accelerated digitization and potential for future information from the Anti-Money Laundering Act of 2020.

Authors

Jules Carter, Moore & Van Allen PLLC Barbara S. Meeks, Moore & Van Allen PLLC

Agenda

BSA/AML Background

Know Your Customer (KYC)

Customer Due Diligence (CDD) Rule

• Customer Identification and Verification

• Risk Assessment

• Customer Risk Profiling

• Customer Monitoring

• Recordkeeping and Retention

The CIP Rule

• Identifying a Customer

• Identifying an Account

• CIP Notice

Beneficial Ownership (Customer Due Diligence Rule)

• Identifying a Legal Entity Customer

• Identifying a Beneficial Owner

Identity Verification

• Required Identifying Information

- Appropriate Identifying Documents

- Identifying Customers Who Cannot Appear In Person

• Verifying Customer Identity

• Reliance on Information From Other Financial Institutions or Third Parties

Enhanced CDD

• Customer Risk Factors

• Enhanced CDD Measures

Customer Monitoring

• Customer Risk Profiles

• Risk-Based Monitoring

Recordkeeping and Retention Requirements

Recent Developments

• Digitization and the Pandemic

• AML Act of 2020

• Corporate Transparency Act

• Enforcement Priorities