Customer Identification Programs for Registered Investment Advisers and Exempt Reporting Advisers is a good idea if it can be done with balancing privacy and security on both sides. The joint proposal by the SEC and the U.S. Department of the Treasury's Financial Crimes Enforcement Network (FinCEN) to implement Customer Identification Programs (CIPs) for Registered Investment Advisers (RIAs) and Exempt Reporting Advisers (ERAs) is a commendable step towards strengthening the anti-money laundering (AML) and countering the financing of terrorism (CFT) framework within the investment adviser sector. This initiative is crucial in mitigating risks associated with illicit finance activities, including money laundering and terrorism financing. Investment advisers play a critical role in the financial system, and their designation as "financial institutions" under the Bank Secrecy Act (BSA) brings them in line with other financial entities that already adhere to stringent AML/CFT regulations. By mandating that RIAs and ERAs establish and maintain written CIPs, this rule aims to prevent the misuse of advisory services by individuals or entities engaged in illicit activities. However, while the primary goal of this proposal is to curb illicit finance, it is imperative to balance this objective with the necessity of protecting customer privacy. Effective AML/CFT measures must be implemented in a manner that respects and safeguards the privacy rights of individuals and entities both domestically and globally. The principles of responsible data privacy practices should be at the forefront of this regulatory framework to ensure that the personal and financial information of legitimate customers is adequately protected from unauthorized access and misuse. The proposed rule stipulates that RIAs and ERAs must implement reasonable procedures to verify the identities of their customers. This verification process should be robust yet flexible enough to accommodate legitimate privacy concerns. It is essential to ensure that these procedures do not become overly burdensome, thereby hindering the ability of investment advisers to efficiently serve their clients. Furthermore, transparency in the implementation of these CIPs is crucial. Clear guidelines and consistent communication with stakeholders will help in fostering trust and compliance. Investment advisers should be well-informed about the requirements and expectations set forth by the proposed rule to facilitate smooth adoption and adherence. In conclusion, the proposed Customer Identification Programs for RIAs and ERAs represent a significant advancement in the fight against money laundering and terrorism financing. However, it is equally important to ensure that these measures are balanced with strong data privacy protections. By doing so, we can achieve a regulatory environment that not only deters illicit finance but also upholds the privacy rights of individuals and maintains the integrity of the financial system.