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ReadersSpeak

What is a 'Beneficial Owner'? Linda,

here can I find information on new regulations that require us to The U.S. Treasury Department's Fi-
gather more personal data on "Beneficial Owners" applying for nancial Crimes Enforcement Net-
merchant services. Who is requiring this? I don't even know what work (FinCEN) discusses "Beneficial
W "Beneficial Owner" means. And what do I do if someone objects Ownership" in its final rules on cus-
to providing more of their own identifying information? In this day and age, tomer due diligence requirements
where security is a major concern, people might want to provide less, not more for financial institutions. FinCEN
data to companies they do business with. summarized this action as follows:
Linda Rosinski "FinCEN is issuing final rules under
Merchant Level Salesperson the Bank Secrecy Act to clarify and
strengthen customer due diligence
requirements for: Banks; brokers or
dealers in securities; mutual funds;
and futures commission merchants
and introducing brokers in commod-
ities. The rules contain explicit cus-
tomer due diligence requirements
and include a new requirement to
identify and verify the identity of
beneficial owners of legal entity cus-
tomers, subject to certain exclusions
and exemptions."

A beneficial owner is an individual
who owns 25 percent or more of the
business applying for services. The
information required is name and ti-
tle; date of birth; address (residential
or business street address); Social
Security number for U.S. customers;
and, for foreign customers, passport
number or other similar ID number,
along with country of issuance. This
information must also be collected
from at least one individual with
controlling authority, such as a CEO
or COO, if said individual doesn't
also own 25 percent or more of the
enterprise. The final rules became
effective July 11, 2016; however, the
applicability date for covered finan-
cial institutions was May 11, 2018.
For full details, visit www.gpo.gov/fd-
sys/pkg/FR-2016-05-11/pdf/2016-10567.
pdf.

Thanks for your excellent question.
Editor
What's on your radar?
There's so much going on in
payments right now, it's challenging
to choose what developments are
most compelling. What do you see
as most promising to your bottom
line? Please send your questions,
concerns and ideas to greensheet@
greensheet.com.

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