We have CSR's opening new accounts for corporations and setting individuals up as owners. Where is some guidance concerning this. Thanks.

What type of guidance are you looking for?

We have received criticism before because we have accounts that are not set up correctly, and how we "don't know" our customers. Is there any written guidance on how individuals should be set up on corporate accounts????

My feelings are:

The 'owner' of the account is the business, not the individuals.

DS is correct. However, depending on whether the individuals that own the business are known to the bank and the type of business they have will dictate the amount of due diligence a bank should perform on that specific business. Along with the standard set of corporate documents, some banks run the owners through the standard CIP process. Additionally, banks gather information concerning the business regarding: what it does, how much of it it does, expected banking activities, etc. Based on those answers, the bank may even ask for more information - income statements, balance sheets, etc. It is usually a tiered approach based on perceived risks.

Exactly. I don't know why we have such a problem with this. They have attended new account seminars that addressed how to properly open accounts and correctly set up individuals. Thanks!!

We have a 25% rule. If anyone has 25% or more ownership of a business entity, they are subject to a full EDD/KYC review. This review includes documentation of all basic CIP info.

We do EDD on all new accounts through our software and keep documentation on file, such as the corporate resolutions. The problem is when they set up individuals on the accounts in core. The individuals should be set up as officers or authorized signors per the resolution, not owners.

elvisfan - I think all banks have issues with this type of thing. The front line is responsible for opening new accounts and that is what they do. Sometimes they 'happen' to forget the requirements.