What is a customer identification program (CIP)?
Definition
A customer identification program (CIP) is the set of procedures a US bank must have to collect identifying details from a person opening an account, such as name, date of birth, address and ID number, and to verify that the person is who they say they are.
- Category
- Identity
- Also called
- CIP, CIP rule, customer identification programme
- Last updated
Reviewed by Anthon Wansland
Head of Product & Co-Founder
Serus is a privacy company with paid tools to find and remove your personal data. This page is free and based on official sources.
A customer identification program, or CIP, comes from US federal rules. For banks it is set out in 31 CFR 1020.220, and similar CIP rules apply to other financial firms, such as broker-dealers (31 CFR 1023.220). It is why a bank asks for your ID when you open an account, even online.
What the bank collects
Before opening an account, a bank must collect at least four items: your name, your date of birth (for an individual), your address and an identification number. For a US person, the number is usually a taxpayer identification number, such as a Social Security number. For a non-US person it can be a passport number with the country of issuance, or another government-issued ID number.
How it checks you
The bank must verify enough of that information to form a reasonable belief that it knows who you are. It does this using risk-based procedures. Verification can be documentary, such as an unexpired government photo ID, or non-documentary, such as checking your details against other sources. It must happen within a reasonable time after the account opens. The bank also has to give customers notice that it is asking for this information, and keep records of what it collected and how it verified it.
Why it matters to you
The rule exists to make it harder for someone to open an account in another person's name. For you that means you hand over sensitive details, including your ID number, so it is worth knowing who is asking. A bank collecting these under its CIP is expected. A stranger who calls, texts or emails asking you to "verify your identity" with the same details is not the same thing, and is a common scam.
CIP vs. related terms
- KYC (know your customer) is the wider practice of understanding who a customer is. The CIP is the identity-collection and verification part of it.
- Identity theft is the crime the CIP helps prevent: someone using your details to open accounts as you.
If your details have been used without your permission, see our identity theft guide.
How to protect yourself
- 1
Give ID details only on channels you started
Open the bank's own website or app, or call the number on your card or statement. FTC guidance says not to click links or call numbers in unexpected messages.
- 2
Treat unexpected requests to verify identity as suspicious
A real bank may ask for ID when you open an account. If someone contacts you first and asks for your Social Security number or ID, stop and contact the institution yourself.
- 3
Check your credit reports
If someone opened an account in your name, it can appear on your credit reports. You can get free reports at AnnualCreditReport.com, the official site.
- 4
Report identity theft at IdentityTheft.gov
The FTC's IdentityTheft.gov is where you report it and get a recovery plan.
See where your personal data is exposed
Serus finds it on data brokers and people-search sites and removes it.
Frequently asked
Why does a bank need my Social Security number?
Under the CIP rule, a bank must collect an identification number from you before opening an account. For a US person, that is generally a taxpayer identification number.
Is a CIP the same as KYC?
No. KYC is the broader practice of knowing your customer. The CIP is the specific part of it that collects and verifies your identity when an account is opened.
Does CIP apply outside the US?
This rule is a US requirement. Other countries have their own customer due diligence and identity checking rules, so the details differ.
Sources
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