According to provisions of the [[USA Patriot Act]], all financial institutions must verify the identity of individuals wishing to conduct financial transactions. The law was implemented by regulations in 2003 which require financial institutions to develop a '''Customer Identification Program''' (CIP) appropriate to the size and type of its business. The CIP must be incorporated into the bank's [[Bank Secrecy Act]]/[[Anti-money laundering]] compliance program, which is subject to approval by the financial institution's board of directors.
== Requirements ==
The CIP is intended to enable the bank to form a reasonable belief that it knows the true identity of each customer. The CIP must include [[new account opening]] procedures that specify the identifying information that will be obtained from each customer. It must also include reasonable and practical risk-based procedures for verifying the identity of each customer. Financial institutions should conduct a risk assessment of their customer base and product offerings, and in determining the risks, consider:
* The types of accounts offered
* The methods of opening accounts.
* The types of identifying information available
* The institution's size, ___location, and customer base
== References ==
[http://a257.g.akamaitech.net/7/257/2422/08aug20031600/edocket.access.gpo.gov/cfr_2003/julqtr/31cfr103.121.htm 31 CFR 103.121] - Federal regulations requiring the CIP.
