How are others documenting your customer due diligence process for consumer deposit accounts, setting an initial risk rating, determining whether EDD is required, and establishing expected activity levels at account opening? The OCC had recommended to us a couple of years ago to put in place a process for collecting and documenting this information. We put in place a form that customers complete and sign when opening a deposit account that collects all of the CIP information, and also asks basic questions about expected cash, wire transfer, and ACH activity levels. We are now hearing from consultants we have engaged in the bank for an overall profitability engagement that none of their other client banks have any such form and that we should eliminate that form requirement from our account opening process. Just wondering how others are handling this.

have engaged in the bank for an overall profitability engagement

So, you gain a little productivity on the front end that they then inflate, so they get to get to claim the percentage of savings as part of their engagement fee.

The bank then has to deal with an MRA or worse in the next BSA/AML exam. Tell them to go take a hike. Almost every bank that I know gathers initial basic due diligence on customers at account opening and use that information in conjunction with their monitoring and alert system for unexpected activity in the first periods of time after account opening until transaction patterns can be established for monitoring purposes.

Who you going to listen too - the OCC or these yahoos? (Trust me - I was one of these yahoos in a past life and I know most of the tricks of the trade) Going backwards in your BSA program is never a good idea and it will be noticed.

My Bank tried exactly that Beech on the very same topic and we ended up with an MRA and a Consent Order (Of course other factors played into this). We could have spent a small amount of $ and time upfront and because we didn't, we are now spending millions. Listen to Randy on this, as his assessment is dead on.

If your consultants are saying that you need less CDD documentation you need less consultants.

Thanks for the input so far. Not really looking for a bashing session for consultants. They are not advocating less CDD. They're saying we don't need to have the customer complete a form to accomplish this. What I really need to know is whether other institutions are having customers fill out a form on this type of expected activity, or are you just asking the questions and documenting in your system somewhere the results? If the latter, have your regulators looked at that and are they OK with that?

I personally agree with the consultants and fought the OCC on this when they first made the recommendation. The form doesn't accomplish anything because any bad actors who might be trying to open an account aren't going to answer the form honestly anyway. I believe we should just be able to set an expected activity level for consumer deposit accounts in general and if that is exceeded, investigate as appropriate.

We do a process that is similar to your current one. I agree with the others - take Randy's advice.

Some new account platforms integrate the account opening CDD information into the new account opening process. Some go as far as determining the customer risk through a various set of questions that then prompt the specific CDD information required. The new accounts representative cannot pass go and cannot collect $200 without this information being fully completed. The CDD information is then transferred directly into the BSA/AML monitoring platform. Whether you ask and record or ask the customer to fill out the form, there is not a whole lot of time saved. It all depends on how well the gathering of the information electronically is integrated into your system and how easy the retrievably of this information might be in the overall scheme of things. If their only suggestion is get rid of the hardcopy and automate the process, OK. But your original post made it seem like they were suggesting that you stop gathering it all together. Again, either way, the time savings is going to be minimal.

Appendix K in the examination manual supports your position, particularly for a U.S. person. Examiners driving banks to accumulate detailed information on consumer customers simply do not comprehend the concept of "risk based." Obviously, if you've made a previous commitment to a regulator you will not abandon the practice without documentation that it proved to be a waste of time and effort.