A Customer Identification Program is a set of procedures and processes implemented by financial institutions, such as banks and credit unions, to verify and document the identity of their customers.
These programs are mandated by anti-money laundering (AML) regulations and are designed to prevent financial institutions from being used for illicit activities, such as money laundering and terrorist financing.
The CIP typically involves collecting and verifying certain information from customers, such as name, address, date of birth, and official identification documentation, to establish and confirm their identity before establishing a business relationship or conducting certain financial transactions.