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Poor Business Classification, Expired Documents Often Undermine Customer ID Programs
By Matt Squire
printAn effective customer identification program is integral to Bank Secrecy Act and anti-money laundering compliance, but AML professionals say many financial institutions' CIP procedures are fraught with errors, including improper business identification procedures and expired data. "If your customer identification and files are in some way deficient, what you have effectively done is render meaningless, or at least ineffective, other elements of your AML compliance program," said Scott Moritz, an executive director with New York-based consultant Daylight Forensic & Advisory. Without reliable CIP data, banks can't assign accurate risk rankings to customers, which in turn weakens transaction monitoring alert analysis,...
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