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FDIC Federal Register Citations

From: Jim Franks
Sent: Thursday, September 05, 2002 10:08 AM
To: Comments

Subject: Proposed Rule on Customer Identification Program - FIL 92-2002; August 22, 2002

RE: Proposed Rule on Customer Identification Program – FIL 92-2002; August 22, 2002

Gentlemen:

Please accept these comments from the Bank of Prescott regarding the proposed rule on the newly required Customer Identification Program. Please be assured that the Bank of Prescott, its staff, stockholders and directors are totally and firmly committed to all reasonable actions to prevent and root out terrorism and terrorists. While we know that regulations normally are written for all banks, it is rather difficult to understand the “overkill” approach of these proposed regulations when it comes to a small rural bank like ours. Our bank has no branches and has little business outside our small rural town. Not only does “everyone know everyone,” it has been said that everyone knows what you are going to do before you actually do it! (This is one of the drawbacks of small-town, rural America – everyone knows your personal business.) Almost all of our employees were born and/or raised right here in our community. There are few customers that most employees do not call by their first name. They went to school together; go to church together; their children and customer’s children have birthday parties together; and on and on. We truly know our customers. Many have had accounts here for 20 years, 30 years, 40 years and even more!

So, with all of this having been said, I trust even you can understand that when a 40-year customer of our bank comes in to open a new grandchild’s first savings account, and we inform this (older) customer that we must have documentation to prove who she is (not withstanding that we know her), plus documentation to prove who her new grandchild is, our customer will most likely not understand. Even worse, she may even get hostile. Situations like this will give banking another black eye. Rather than make new regulations it would be appropriate to enforce the ones already on the books.

I noticed that your proposed regulations “claim” to have some flexibility for each bank based on the specific bank’s makeup, size, complexity, situation, etc. However, the flexibility does absolutely nothing for such situations as outlined above. I feel that accommodations should be made for situations in which the customer has been a customer of the bank for such a period of time or is actually known by bank personnel.

Secondly, there appears to be no allowances made for government entities. How do we document/prove who the State of Arkansas is; the City of Prescott; or for that matter, the United States of America? The regulations need to be either more specific or make allowances for “common sense” situations, something regulations rarely do by the way.

I appreciate this opportunity to comment on the proposed regulation.

Jim Franks
Executive Vice President
Bank of Prescott
PO Box 490
Prescott, Arkansas 71857

Last Updated 09/05/2002 regs@fdic.gov

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