Customer Identification Program Procedures by hdePk04


									                         Bank Secrecy Act / Anti-Money Laundering
                            Minimum Procedure Requirements

Customer Identification Program Procedures
1. Identification of information required to be obtained (including name, address, taxpayer
   identification number (TIN) and date of birth, for individuals), and risk-based.
2. Identity verification procedures (including procedures that address situations in which
   verification cannot be performed).
3. Procedures for complying with recordkeeping requirements.
4. Procedures for checking new accounts against prescribed government lists, if applicable.
5. Procedures for providing adequate customer notice.
6. Procedures covering the bank’s reliance on another financial institution or a third party, if
7. Procedures for determining whether and when a Suspicious Activity Report (SAR) should be

Customer Due Diligence Procedures
1. Procedures for determining customer risk;
     a) Account opening risk
        (i)   Purpose of the account, owners and beneficiaries, source                of   funds,
              occupation/business type, references, and customer/Bank proximity.
     b) Enhanced due diligence (On-going monitoring for high-risk customers).

Suspicious Activity Reporting Procedures
1. Lines of communication for the referral of unusual activity to appropriate personnel.
2. Designation of individual(s) responsible for identifying, researching, and reporting
   suspicious activities.
3. Monitoring systems used to identify unusual activity.
4. Procedures to ensure the timely generation of, review of, and response to reports used to
   identify unusual activities.
5. Procedures for reviewing and evaluating the transaction activity of subjects included in law
   enforcement requests (e.g., criminal subpoenas, 314(a) requests, or national security letters
   (NSLs)) for suspicious activity.
6. Procedures for documenting decisions not to file a SAR.
7. Procedures for considering closing accounts as a result of continuous suspicious activity.
8. Procedures for completing, filing, and retaining SARs and their supporting documentation.
9.   Procedures for reporting SARs to the board of directors, or a committee thereof, and senior

Currency Transaction Reporting Procedures
1. Preparation
2. Filing
3. Retention

Currency Transaction Reporting Exemption Procedures
1. Preparation
   a) Filing
      (i)    Phase I (not required to file for Banks, Federal, State or other Government entities)
      (ii)   Phase II
   b) Periodic Eligibility Review

Information Sharing Procedures
1. 314(a)
   a) Designated point of contact
   b) Confidentiality/Safeguarding
   c) Responding
   d) When a SAR should be filed
   e) Records to be search
   f) Documentation to evidence compliance
2. 314(b)
   a) Designated point of contact.
   b) Confidentiality/Safeguarding of information sent/received.
   c) Establish a process for sending and responding to requests, including ensuring that other
      parties with whom the financial institution intends to share (including affiliates) have
      filed the proper notice.
   d) When a SAR should be filed.

Purchase and Sale of Monetary Instruments Procedures
1. Documentation of required records
2. Non-Customer Transactions

Funds Transfers Procedures
1. Documentation of required records
2. Non-Customer Transactions

Office of Foreign Assets Control (OFAC) Procedures
1. The extent of, and method for, conducting OFAC searches of each relevant
   department/business line (e.g., automated clearing house (ACH), monetary instrument sales,
   check cashing, trusts, loans, deposits and investments) as the process may vary from one
   department or business line to another.
2. The extent of, and method for, conducting OFAC searches of account parties other than
   accountholders, which may include beneficiaries, guarantors, principals, beneficial owners,
   nominee shareholders, directors, signatories and powers of attorney.
3. How responsibility for OFAC is assigned.
4. Timeliness of obtaining and updating OFAC lists or filtering criteria.
5. The appropriateness of the filtering criteria used by the bank to reasonably identify OFAC
   matches (e.g., the extent to which the filtering/search criteria includes misspellings and name
6. The process used to investigate potential matches.
7. The process used to block and reject transactions.
8. The process used to inform management of blocked or rejected transactions.
9. The adequacy and timeliness of reports to OFAC.
10. The process to manage blocked accounts (such accounts are reported to OFAC and pay a
    commercially reasonable rate of interest).
11. The record retention requirements (i.e., five year requirement to retain relevant OFAC
    records; for blocked property, record retention for as long as blocked; once unblocked,
    records must be maintained for five years).

Trust and Asset Management Procedures
1. Procedures for gathering additional information, when necessary, about the settler, grantor,
   trustee or other persons with authority to direct a trustee, and who thus have authority or
   control over the account, in order to establish a true identity of the customer.

Non-Bank Financial Institution Procedures
1. Money Service Businesses
       a) Confirm FinCEN registration, if required
       b) Confirm state licensing, if applicable
       c) Confirm agent status, if applicable
       d) Conduct a risk assessment to determine the level of risk associated with each account
          and whether further due diligence is required.


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