FinCEN Rule Requires Stronger Due Diligence
The Customer Due Diligence Rule ("CDD Rule") issued by the U.S. Department of the Treasury Financial Crimes Enforcement Network ("FinCEN") requires financial institutions to collect and verify specific personal identity information. The required information includes name, address, date of birth and taxpayer identification number (e.g., Social Security Number), related to beneficial owners and at least one controller of each legal entity customer with U.S.-based accounts. A copy of an unexpired government-issued identification (e.g., driver's license or passport) may be required for:
- Beneficial Owners: all individuals who directly or indirectly own 25% or more of the legal entity; and at least one
- Controlling Person: an individual with significant responsibility to control, manage or direct the legal entity
A Beneficial Owner who meets the definition of Controlling Person can also satisfy both the owner and controller requirements.
Most U.S. publicly traded, regulated, and government entities will be excluded from the CDD Rule requirements. Visit FinCEN.gov for more information about the CDD Rule.