CIP FAQs - Are loan participations purchased from third parties and loans purchased from a car dealer or mortgage broker within the exclusion from the definition of “account” for loans acquired through an acquisition, merger or purchase?

Compliance > BSA > FinCEN FAQs - CIP
Q:  Are loan participations purchased from third parties and loans purchased from a car dealer or mortgage broker within the exclusion from the definition of “account” for loans acquired through an acquisition, merger, purchase of assets, or assumption of liabilities?
 
A:  Yes, this exclusion is intended to cover loan participations purchased from third parties and loans purchased from a car dealer or mortgage broker. If, however, the bank is extending credit to the borrower using a car dealer or mortgage broker as its agent, then it must ensure that the dealer or broker is performing the bank’s CIP. (January 2004)

 
ADDITIONAL INFORMATION
This FAQ was excerpted from the Interagency Interpretive Guidance on CIP Requirements that can be found at the following link:  https://www.fincen.gov/sites/default/files/guidance/faqsfinalciprule.pdf
 

 

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