Question of the Week

Question:  Do we have to CIP another credit union or bank that wants to open an account?

Answer:  No. The Bank Secrecy Act excludes certain persons from CIP coverage:

(2) Customer does not include:

(i) A  financial institution regulated by a  Federal functional regulator or a  bank regulated by a State  bank regulator;(ii) A  person described in  § 1020.315(b)(2) through (b)(4); or
(iii) A  person that has an existing  account with the  bank, provided that the  bank has a reasonable belief that it knows the true identity of the  person.

This coverage excludes another financial institution regulated by a federal functional regulator (another credit union) or bank. 

However, exclusion from CIP does not exclude from OFAC coverage. You should OFAC any person you do business with, consistent with your OFAC screening parameters.