On February 7, the FDIC’s Acting Chairman Travis Hill released a letter to FinCEN Director Andrea Gacki conveying support for updates to the Customer Identification Program requirements to align with modern practices. Hill emphasized the need for expedited regulatory changes allowing banks to onboard customers using the last four digits of their tax identification number — only permitted for nonbank companies currently. This change, according to Hill, would reduce frictions for customers seeking relationships with banks and fintechs.
Hill noted the USA PATRIOT Act, and its implementing regulation, permits the Treasury Department and federal financial regulators to exempt financial institutions from certain regulatory requirements. Hill also pointed out that federal authorities have long allowed banks to onboard credit card customers using similar methods and expressed a desire to extend this approach more broadly.
