Certification of Beneficial Owner(s) and Control Person

Effective May 11, 2018, Bank Secrecy Act regulation issued by the Financial Crime Enforcement Network (FinCEN) requires all legal entities to certify beneficial owner(s) and a control person by completing a Certification of Beneficial Owner(s) and/or Control Person form with every new account opened, CD renewals or as requested by the financial institutions.

 

Why the change?
The rule helps fight money laundering, terrorist financing, tax evasion, fraud and other financial crimes that are impacting our nation. The final rule requires financial institutions to identify and verify the identity of the beneficial owners and control person of all legal entity customers at the time a new account is opened, at a renewal, or as requested.
What is a Beneficial Owner?
A beneficial owner is any individual who directly or indirectly owns 25% or more of the equity interests of the legal entity customer.
What is a Control Person?
A control person is a single individual with significant responsibility to control, manage, or direct the legal entity customers (e.g. a Chief Executive Officer, President, Vice President, Treasurer, Executive Director, etc.).
What is an account?
An account is defined as deposit (checking, savings, CD), loan and safe deposit box.
What businesses are impacted?
The regulation applies to legal-entity businesses including corporations, limited liability companies, partnerships and entities created by filing with the state office.
What businesses are exempt?
Sole Proprietors, unincorporated associations, trusts and estates, U.S., State, and local government entities, registered insurance companies, publically traded companies and subsidiaries, charities and nonprofit entities.

NOTE: Nonprofit entities are still required to complete the control portion of the certification form.
How will this impact your business?
Every time you open a new account for your legal business entity, you will be required to certify the information for all beneficial owner(s) and a control person.
When are Certification of Beneficial Owner(s) and/or Control Person forms required?
If not already on file at the bank, a form will be required:
  • Every time a new account (as defined above) is opened;
  • Change in authorized signer;
  • Change in ownership or control;
  • At the first renewal date of a certificate of deposit opened prior to May 11, 2018
  • At the financial institution’s request
When is the Re-Certification of Beneficial Owner(s) or Control Person form needed?
If a Certification form is already on file:
  • Every time a new account (as defined above) is opened;
  • Change in authorized signer unless a change in ownership or control
  • At the financial institution’s request
What information is required on the Certification form?
  • Name
  • Residential Address
  • Date of Birth
  • Social Security Number or Tax Identification Number
  • Percentage ownership
What identification documentation is required with the Certification form?
In addition to the form, a copy of one of these IDs will be required.
  • Driver’s license
  • State-issued Identification Card
  • Passport
NOTE: documentation must be valid.