What to Know: Beneficial Ownership Identification and Verification Requirements

The beneficial ownership identification regulation requires all banks to identify and verify the identity of the beneficial owners of all legal entity customers, for all new accounts opened after May 11, 2018, including new accounts opened for current customers. This regulation impacts all accounts of the bank: loan, depository, and investment accounts. This new regulation is designed to assist law enforcement in combatting money laundering and other federal crimes and brings the United States in line with international standards.

To whom does this law apply?

To whom does this law not apply?

Does this law apply to existing accounts?

What information is needed for the “beneficial owner”?

Who qualifies as a “beneficial owner”?

So, what do you mean by “individuals directly or indirectly owning 25%”?

So, what do you mean by an “individual who has significant responsibility to control, manage, or direct”?

How does the bank verify and identify the beneficial owners?

View examples of implementation

1 Other than statutory trusts created by a filing with a state office, these are “business trusts” organized like LLCs. Personal trusts are exempt from the rule
2 Additional exempt entities include U.S. or state government agencies, banks and other regulated financial institutions, etc.
3 Can substitute passport information
4 Can substitute information from some other government issued photo identification, should include license number issue and expiration date
5 Designated under the “ownership prong” of the regulation
6 Designated under the “control prong” of the regulation
7 Or passport information, including number, issuing entity, issue date and expiration date.
8 Or other government issued photo identification

 
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