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                                   FinCEN issues New CIP Policy for ACP Accounts



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The U.S. Treasury Department's Financial Crimes Enforcement Network ("FinCEN"), on November 3, 2009, provided guidance to financial institutions regarding application of customer identification programs ("CIPs") to customers who have been issued a post office box through a state address confidentiality program ("ACP"). (Offered by 31 States, ACPs provide a substitute address for victims of domestic violence, sexual assault and stalking and help participants keep their physical address confidential. Substitute addresses are accepted by state and local agencies.)

Under the CIP rules, a financial institution must obtain a street address from each individual customer who opens an account. If the individual customer does not have a residential or business street address, the financial institution may instead accept the street address of the customer's next of kin or another contact individual.

FinCEN has ruled that it will allow a financial institution to treat a person who participates in a state-created ACP as an individual who does not have a street address.

Our recommendation:

Identity Theft Prevention Program: financial institutions that utilize CIP procedures in their Identity Theft Prevention Program should update their policies accordingly.

In performing its CIP, the financial institution should obtain the street address of the ACP's sponsoring agency, treating that agency as another contact individual for the customer opening the account.

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New Rule

FinCEN now authorizes the following exception to the requirement to obtain a customer's residential or business street address:

A customer who participates in a state-created ACP shall be treated as not having a residential or business street address and a secretary of state, or other state entity serving as a designated agent of the customer consistent with the terms of the ACP, will act as another contact individual for the purpose of complying with FinCEN's rules.

Therefore, a a financial institution should collect the street address of the ACP sponsoring agency for purposes of meeting its CIP address requirement.

[Authority: 31 U.S.C. 5318(a)(5) and 31 C.F.R. 103.55(a)]

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Customer Identification Program Rule - Address Confidentiality Programs, FIN-2009-R003, November 3, 2009

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