📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!

    Question

    Which of the following is NOT a requirement for the

    Customer Identification Procedure (CIP) under RBI's KYC regulations for financial institutions?
    A The customer’s identity documents must be verified during the commencement of the account-based relationship Correct Answer Incorrect Answer
    B Third-party verification of customer data is allowed, provided the records are immediately obtained from the third party Correct Answer Incorrect Answer
    C The RE can seek introductions from existing customers while opening accounts to validate the new customer’s identity Correct Answer Incorrect Answer
    D The customer’s identification data must be obtained if there is doubt about its authenticity Correct Answer Incorrect Answer
    E The RE is required to carry out CDD if the customer makes a transaction exceeding â‚ą50,000 Correct Answer Incorrect Answer

    Solution

    RBI guidelines strictly prohibit using introductions from existing customers as a means of verifying new customers. This is to ensure that financial institutions independently verify the identity of their customers, avoiding the risks associated with fraudulent activities. The other options are requirements as part of the Customer Identification Procedure (CIP) , ensuring thorough customer verification and documentation.  

    Practice Next
    More Financial Management Questions
    ask-question