Customer due diligence requirements

What is the FinCEN Final Rule?

Under the updated requirements for Customer Due Diligence, covered financial institutions must expand programs, including Customer Identification Programs (CIP), to include Beneficial Owners of Legal Entity customers.

These requirements are intended to prevent anonymous access to financial systems, since the US Treasury estimates that illicit proceeds generated in the US alone total 400 Billion dollars annually.

The new rule requires financial institutions to collect and verify identity information (name, address, date of birth, Social Security number or passport number for foreign individuals):

  • For each natural person with at least 25% ownership in the legal entity
  • For an individual with significant responsibility for managing or controlling the business — for example, a chief executive officer, a chief financial officer, a chief operating officer, a managing member, a general partner, a president, a vice president or a treasurer

Compliance with the rule is mandatory by May 11, 2018.

Who is impacted by the FinCEN Rule?

The final rule applies to all covered financial institutions:

  • Depository institutions, including insured banks, commercial banks, savings associations, federally-insured credit unions, federally-regulated trust companies, U.S. agencies and branches of a foreign bank, and Edge Act corporations
  • Securities broker-dealers
  • Mutual funds
  • Futures commission merchants and introducing brokers in commodities

Covered financial institutions are required to adopt due diligence procedures to identify and verify a legal entity customer’s beneficial owner(s) at the time a new account is opened.

How Can Experian Help my Business Comply with the FinCEN Rule?
 
FinCEN Customer Due Diligence Rule Consumer Business Experian® has you covered Access Methods
Identify and verify customer - For both consumer and business Batch, Web, XML
Identify and verify beneficial owner(s) of Legal Entity - For individual consumer(s)   Batch, Web, XML

Understand the nature and purpose of customer relationships to develop a customer risk profile - For both consumer and business

Batch, Software Solution, Web, XML

Ongoing monitoring for reporting suspicious transactions and, on a risk basis, maintaining and updating customer information - For both consumer and business

Batch, Software Solution, Web

 = Identifies the entity the rule applies to

 = Experian solutions available 

Blank = Not applicable

 

Smooth the path to meeting the requirements for the FinCEN Rule compliance with helpful information sources and tools.

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