Answer:
The record retention provisions of BSA regulations require you to obtain a TIN for every deposit account you open. If the person claims not to have a TIN because she is a nonresident alien, the regulation requires you to see evidence of foreign citizenship; e.g. a passport.
There is no exclusion for a U.S. person who does not want to supply a TIN. However, BSA regulations would allow you to open the account as long as you keep a current list of all accounts for which you do not have a valid TIN on file.
If the account is interest bearing and you open it without a TIN, you will have to impose backup withholding from the day the account is opened.
The best policy is "No TIN? No account." It may be even more advisable in your situation. The application for a U.S. passport asks for an SSN and federal law indicates it the applicant must supply it. Your potential customer probably does have a SSN, she just doesn't want to give it to you.
Whether you call the philosophy "know your customer" or "enhanced due diligence," this is not the time to be waiving basic requirements for identification.
First published on BankersOnline.com 2/4/02
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