![]() ![]() This seems to create operational challenges, but is this what Congress intended? Section 1020.220 of the BSA only requires credit unions to “record a description of any documents that were relied on, noting the type of document, any identification number contained in the document, the place of issuance and, if any, the date of issuance and expiration date" rather than the scanning or copying of a member’s ID.įor those reasons, if the account, service or product requested online requires the member’s ID for verification purposes, it seems that the plain reading of section 213 would require permanently deleting this record after using it for those purposes. However, the BSA does not explicitly require retaining the records. Some also indicate retaining copies of IDs as part of their BSA CIP program, asking whether this would allow retaining the record. Many credit unions indicated that they retain copies of IDs to assist in verifying members' identities on an ongoing basis, such as when they come to branches to make withdrawals. However, the BSA rules do not mandate keeping copies, just recording a description of the documents relied upon when using documentary methods. We would hope that regulators may provide clarification, such as FinCEN perhaps addressing how section 213 interplays with a customer identification program (CIP). Section 213 also does not specifically require any regulator to exam or enforce the bill. ![]() ![]() In other words, it does not seem to be a statute with stand-alone penalties. This may be because, from our discussions with staffers on Capitol Hill who worked on this particular section, the aim was to make online account opening easier. It is not clearly incorporated into an existing part of the US Code that addresses issues like civil liability, regulatory authority and enforcement. So, to what extent might the requirement to delete copies of IDs actually disrupt credit unions' processes, and what would be the penalty for being deemed non-compliant because an ID was kept on record?Īs a starting point, section 213 is a freestanding provision, meaning it does not amend a pre-existing statute or framework. Unfortunately, section 213 has caused quite the stir because a plain reading of the deletion section seems to indicate that unless a law requires the credit union to keep a copy or image of a member’s ID, the credit union would have to permanently destroy this copy/image after using it for one of those three purposes. the Bank Secrecy Act's customer identification program requirements). Complying with a legal requirement to record, retain or transmit personal information in connection with opening an account (e.g.Verifying that the identification card is authentic or.However, the wording of this law seems to indicate that, when opening accounts online, it is a requirement to delete a copy or image of a member's identification card after using that copy for one of the following: Section 213 attempts to overcome these hurdles and preempts any directly conflicting state law provision, thus allowing credit unions the ability to serve their e-savvy members. Some credit unions were having a hard time offering online account opening services because the copying or scanning of a member’s personal identification was prohibited by a state law. Since the passage of S.2155 (the Economic Growth, Regulatory Relief and Consumer Protection Act) in May 2018, many credit unions have wondered about a particular provision – section 213, titled "making online banking initiation legal and easy."Īs background, S.2155’s ID retention provision was first introduced as part of the MOBILE Act (which was never passed) and later tacked on to S.2155. By Brandy Bruyere, NCCO, Vice President of Regulatory Compliance, NAFCU ![]()
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