Acting Comptroller of the Currency Rodney E. Hood issued the following statement today in support of the Order granting an exemption to the Customer Identification Program (CIP) rule to benefit both consumers and the banking industry.
I support the Order granting an exemption to the Customer Identification Program, or CIP rule, allowing banks to utilize an alternative collection method to obtain Taxpayer Identification Number information from a third party, rather than from a customer, provided that certain other criteria are met.
The Order is a good step in the process of Bank Secrecy Act (BSA) modernization. It will benefit both consumers and the banking industry by promoting innovation and financial inclusion and providing banks more flexibility to operate in a manner that suits their business model.
The Order promotes an innovative approach to CIP compliance by supporting greater use and acceptance of online or mobile banking activities and allowing banks to leverage the use of online identity verification services that were neither available nor contemplated by regulators when this rule was adopted in 2003. The Order also promotes financial inclusion, allowing greater access to financial products and services by addressing the legitimate concerns of customers who are unwilling to provide their full TIN in an electronic format, in an online account opening or credit application.
Importantly, this Order does not impose any new requirements, but instead has the potential to ease regulatory burden by allowing banks the choice to adopt new, innovative methods of CIP compliance, if the bank deems them to be beneficial for its business model.
I want to stress that the changes allowed by the Order provide these benefits without compromising the ability of the nation’s BSA regime to combat money laundering, terrorist financing, and other financial crime.
Finally, I would like to thank the staff at the federal financial institution regulatory agencies and our colleagues at FinCEN for their hard work and collaboration on this matter.
