CIP is why opening a brokerage account asks for a tax identification number, a residential address rather than a post box, and a document upload if electronic verification fails. The firm must keep records of what was collected and how it was verified.
Verification may be documentary, such as a passport or driving licence, or non-documentary, such as matching against credit bureau and public data. Firms must also check customers against government lists where required.
CIP is the entry point only. Ongoing obligations sit in customer-due-diligence, which requires understanding the expected activity of the account so that deviations can be flagged.
Related: customer-due-diligence, kyc, bank-secrecy-act, beneficial-ownership-rule, anti-money-laundering