The Clearing House submitted a comment letter responding to FinCEN’s proposal to codify customer due diligence (CDD) requirements within its regulations and to impose a new requirement to identify the beneficial owners of certain legal entity customers. TCH strongly supports the significant improvements FinCEN made from its 2012 advanced notice of proposed rulemaking on the same topic. TCH also suggested a number of changes including: (i) revising language that significantly undermines the clarity and consistency of the regulatory CDD framework by suggesting that federal functional regulators have the ultimate authority to determine CDD standards in practice; (ii) not requiring financial institutions to re-identify beneficial owners of existing customers, provided they have a reasonable belief that they have previously identified current beneficial owners; (iii) allowing financial institutions to collect beneficial ownership information through means other than the model certification form; and (iv) allowing financial institutions to use a risk-based approach to determine when it is necessary to verify the identity of beneficial owners and how such verification should be performed.
You Might Also Be Interested In...
AML, Bank Secrecy Act and Sanctions Financial Crime Fighters’ Huge Tech Revamp Is More Urgent Than Ever. Here’s What’s Needed to Finish It
AML, Bank Secrecy Act and Sanctions BPI Recommends Changes to Suspicious Activity Report Sharing Pilot Program to Encourage Participation
AML, Bank Secrecy Act and Sanctions BPI Responds to FinCEN Request for Comment on Renewal of Foreign Financial Agent Transaction Reporting
AML, Bank Secrecy Act and Sanctions BPI Comments on FinCEN Review of Bank Secrecy Act Regulations and Guidance
AML, Bank Secrecy Act and Sanctions BPI Supports FinCEN Effort to Stem Shell-Company-Enabled Money Laundering
AML, Bank Secrecy Act and Sanctions BPI Submits Recommendations to FinCEN as Bureau Implements Beneficial Ownership Changes
More Posts by This Author
Digital Assets BPI Comments on Treasury Department Review of Digital Assets in Response to Executive Order
Community Reinvestment Act BPI Comments on Federal Banking Agencies’ Community Reinvestment Act Proposal
Bank Liquidity The Bank of England Just Released Its Plan for Getting Smaller. The Fed Could Learn from it.