Section 1 Short title
This Act may be cited as the “Municipal IDs Acceptance Act”.
Municipal IDs Acceptance Act
A BILL
To require the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Financial Crimes Enforcement Network, the National Credit Union Administration, the Office of the Comptroller of the Currency, and the United States Department of the Treasury to update guidance on customer identification regulations with respect to the use of identification cards issued by a municipality, and for other purposes.
Sec. 2 Findings
Congress finds the following:
Current law and regulations require certain financial institutions, including depository institutions, savings associations, and credit unions, to have a Customer Identification Program to identify customers who wish to open accounts.
A financial institution must have risk-based procedures for evaluating new customers that allow the financial institution to form a reasonable belief that the financial institution knows the true identity of the customer.
Guidance on the Consumer Identification Program has not been updated since the staff of the Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, Financial Crimes Enforcement Network, National Credit Union Administration, Office of the Comptroller of the Currency, Office of Thrift Supervision, and the United States Department of the Treasury (in this section referred to as “the Agencies”) issued “Interagency Interpretive Guidance on Customer Identification Program Requirements under Section 326 of the USA PATRIOT Act, 2005 FAQs”.
Over the last decade more than two dozen cities and counties in the United States have instituted municipal identification programs, issuing a form of identification to residents who typically do not have driver’s licenses, including young people, the elderly, homeless residents, and immigrants.
Municipal identification programs help vulnerable populations access private and public services, including library services, utility accounts, food, medical care, and housing assistance.
While the Agencies have issued statements about the use of municipal identification for consumer identification, many financial institutions have been hesitant to incorporate municipal identification into the Consumer Identification Programs, limiting access to banking for underserved populations.
It is important for the Agencies to clarify, in guidance, that financial institutions may accept municipal identification to establish a customer’s identity if such identification enables the bank to form a reasonable belief that the bank knows the true identity of the customer.
Sec. 3 Updating guidance on customer identification regulations
The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Financial Crimes Enforcement Network, the National Credit Union Administration, the Office of the Comptroller of the Currency, and the Department of the Treasury shall update the guidance titled “Guidance on Customer Identification Regulations Financial Crimes Enforcement Network FAQs: Final CIP Rule” issued on January 8, 2004, to state that an identification card issued by a municipality may be used by a bank to verify the identity of a customer if such identification card enables the bank to form a reasonable belief that the bank knows the true identity of the customer.