What should the CIP procedures of a credit union describe?

The customer identification program (CIP) procedures of a credit union are specifically designed to meet the regulatory requirements established by the USA PATRIOT Act. These procedures must detail how the credit union will confirm the identity of individuals opening accounts. This involves outlining the methods for verifying identity—such as using government-issued identification, or verifying identity through third-party databases.

Additionally, the procedures should list the types of documents that may be accepted for identity verification. This ensures that there is a clear understanding of what forms of identification are acceptable and how they will be used during the account opening process. By defining these elements, the credit union can more effectively mitigate risks associated with identity theft and fraud, while also ensuring compliance with federal regulations.

This choice aligns with the expectations set out in the regulations regarding customer identification, as it provides specific details that help institutions perform due diligence in verifying the identities of their customers. Other options, while potentially relevant to other aspects of operations, do not focus on the specific requirements related to identity verification as mandated by the CIP.