FinCEN, the Financial Crimes Enforcement Network, is proposing revisions to Bank Secrecy Act rules to clarify and strengthen customer due diligence requirements specifically for beneficial owners of legal entity customers.
FinCen’s position is that a CDD program consists of four elements:
The first item is already addressed in the customer identification program (CIP or MIP) requirements within the BSA rules. The proposed FinCEN rule addresses the remaining three bullets.
At the time of account opening, a credit union will be required to obtain a standard certification form from the individual opening the new account on behalf of the legal entity customer. This certification form is supplied as an appendix to the regulation.
Credit unions are encouraged to review the proposed rule and provide comments as outlined in the MCUL & Affiliates’ comment call.