opening a bank account in washington state
Any customer desiring to open an account relationship in the United States with a federally regulated bank, savings association (including Edge Act and Agreement corporations, and branches and agencies of foreign banks in the United States), credit union, non-federally regulated private bank, and trust company (hereinafter, a bank) is subject to the provisions of 31 CFR 103.121 of the USA PATRIOT Act. The Act requires banks to have a Customer Identification Program “CIP”. The CIP was put into effect to deter money laundering and the funding of terrorist activities.
It is important to know that a bank’s CIP includes account-opening procedures that specify the identifying information that will be obtained from each customer. It also includes reasonable procedures for verifying the identity of each customer. The procedures enable the bank to form a reasonable belief that it knows the true identity of each customer.
An “account” pursuant to the CIP rule is a formal banking relationship to provide or engage in services, dealings, or other financial transactions, and includes a deposit account, a transaction or asset account, a credit account, or other extension of credit. An account also includes a relationship established to provide a safe deposit box or other safekeeping services, or cash management, custodian, and trust services.
The CIP rule applies to a “customer.” A customer is a “person” (individual, corporation, partnership, or trust) who opens a new account, an individual who opens a new account for another individual who lacks legal capacity, and an individual who opens a new account for an entity that is not a legal person (e.g., a civic club). A “customer” does not include a person who does not receive banking services, such as a person whose loan application is denied. The definition of “customer” also does not include an existing customer as long as the bank has a reasonable belief that it knows the customer’s true identity
The CIP details the identifying information it must obtain from each customer. At a minimum, the bank must obtain the following basic information from the customer prior to opening the account:
For a U.S. person
For a non-U.S. person
A bank need not establish the accuracy of every element of identifying information obtained but it must verify enough information to form a reasonable belief that it knows the true identity of the customer.
It is important to know that a bank’s CIP includes account-opening procedures that specify the identifying information that will be obtained from each customer. It also includes reasonable procedures for verifying the identity of each customer. The procedures enable the bank to form a reasonable belief that it knows the true identity of each customer.
An “account” pursuant to the CIP rule is a formal banking relationship to provide or engage in services, dealings, or other financial transactions, and includes a deposit account, a transaction or asset account, a credit account, or other extension of credit. An account also includes a relationship established to provide a safe deposit box or other safekeeping services, or cash management, custodian, and trust services.
The CIP rule applies to a “customer.” A customer is a “person” (individual, corporation, partnership, or trust) who opens a new account, an individual who opens a new account for another individual who lacks legal capacity, and an individual who opens a new account for an entity that is not a legal person (e.g., a civic club). A “customer” does not include a person who does not receive banking services, such as a person whose loan application is denied. The definition of “customer” also does not include an existing customer as long as the bank has a reasonable belief that it knows the customer’s true identity
The CIP details the identifying information it must obtain from each customer. At a minimum, the bank must obtain the following basic information from the customer prior to opening the account:
- Name;
- Date of birth, for individuals;
- Address; and
- Identification number.
For a U.S. person
- taxpayer identification number (TIN)
- Social Security Number
- Employer Identification Number
For a non-U.S. person
- TIN
- Passport number and country of issuance
- Alien identification card number
- Number and country of issuance of any other unexpired government-issued document evidencing nationality or residence and bearing a photograph or similar safeguard
A bank need not establish the accuracy of every element of identifying information obtained but it must verify enough information to form a reasonable belief that it knows the true identity of the customer.
Doug Kemper is President & CEO of the Export Finance Assistance Center of Washington and may be contacted at [email protected]. Company website is www.efacw.org. Mr. Kemper’s organization provides export finance advice to businesses located in the State of Washington.