FinCEN, banking agencies propose customer ID requirements for stablecoin issuers | ABA Banking Journal
The Financial Crimes Enforcement Network and federal banking agencies today releaseda proposed joint ruleto establish customer identification program, or CIP, requirements for payment stablecoin issuers, as. . .
The Financial Crimes Enforcement Network and federal banking agencies today releaseda proposed joint ruleto establish customer identification program, or CIP, requirements for payment stablecoin issuers, as mandated by the Genius Act. According toa summary of the CIP proposal, stablecoin issuers would be required to obtain a customer’s name, an individual’s date of birth, an entity’s date of formation, an address and an identification number before opening an account. Issuers would also be required to establish procedures for denying service or setting special terms when a customer’s identity cannot be immediately verified. In addition, the proposal would establish recordkeeping and customer notification requirements as well as procedures for determining whether customers appear on any list of known or suspected terrorists or terrorist organizations. Stablecoin issuers would also be allowed to rely on another federally regulated financial institution’s customer identification procedures, under “reasonable” circumstances. A federal regulator, with the concurrence of the Treasury secretary, would be allowed to exempt any issuer or account from the customer identification requirements. The secretary also would be allowed to make an exemption, if the appropriate federal regulator agrees. Separately, in April, FinCEN and the Office of Foreign Assets Control issueda separate but related proposed ruleto establish anti-money laundering/countering the financing of terrorism and sanctions obligations on issuers. Issuers would be required to maintain AML/CFT programs and the infrastructure to block or freeze transactions that violate U. S. sanctions. The American Bankers Associationcommented on this proposalearlier this month, emphasizing the importance of ensuring issuers follow the same rules as banks.