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MoFo Reenforcement The Enforcement Blog

New Agency Guidance on Applying CIP Requirements to Prepaid Cardholders

Posted in Credit Cards, Regulatory Developments

In response to continuing concerns about the vulnerability of prepaid cards to criminal and terrorist abuse, five regulators issued interagency joint guidance on March 21 clarifying bank obligations to identify prepaid card accountholders under the existing regulations implementing the “Customer Identification Program” or “CIP” requirements of the USA PATRIOT Act. The Agencies intend the guidance to remind banks that money laundering and other criminal risks related to prepaid cards “require the implementation of strong and effective mitigating controls.”

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