ALERT! New Customer Due Diligence Rules: Part One Legal Entity Customers

FinCEN is issuing final rules under the Bank Secrecy Act to clarify and strengthen customer due diligence requirements for: banks and credit unions; brokers or dealers in securities; mutual funds; and futures commission merchants and brokers in commodities. The rules contain explicit customer due diligence requirements and include a new requirement to identify and verify the identity of beneficial owners of legal entity customers, subject to certain exclusions and exemptions. 

Ready, set go! It’s time to implement new CDD rules for legal entities customers. This program will highlight the nuts and bolts of the new regulation issued May the 11th and what it will mean to legal entity customers. FinCEN believes that there are four core elements of customer due diligence (CDD), and that they should be explicit requirements in the anti-money laundering (AML) program for all covered financial institutions, in order to ensure clarity and consistency across sectors:  (1) customer identification and verification, (2) beneficial ownership identification and verification, (3) understanding the nature and purpose of customer relationships to develop a customer risk profile, and (4) ongoing monitoring for reporting suspicious transactions and, on a risk-basis, maintaining and updating customer information.  

Covered Topics:

  • Final rule and changes
  • What is a legal entity
  • Who is included and excluded?
  • What special rules do we add for beneficial owners?
  • Do we have to use the new form?
  • Can we gather beneficial ownership information at lower amounts than 25%?
  • Do we have to use our same CIP for beneficial owners or can we use a different but similar CIP?
  • Are trust covered? IOLTA? 
  • How does this work on a multi-tiered business?
  • What do we do on charities and nonprofit organizations?
  • Does this apply to sole proprietorship accounts 
  • How do we risk rate? Monitor?
  • Develop new procedures and policies for business accounts
Also, attend this program and receive:
  • A Sample Policy 
  • Sample Legal Entity Handbook with procedures
  • Script for business and legal entities

Who Should Attend?

BSA Officers, BSA Staff, CIP and Deposit Operations, Branch Personnel, Training, Compliance and anyone who opens legal entity accounts.