In 2007 65% of those surveyed at a BOL Top Gun conference reported that they DO CIP authorized signers. That would seem to be consistent with recent FinCEN guidance to obtain beneficial ownership info. What are current statistics, how many institutions currently CIP authorized signers?

I am unclear as to how being an authorized signer for a business entity equates to having beneficial ownership in that business entity. Did FinCEN guidance suggest that? I obviously need to back up and do some reading. Can you provide the cite? THANKS.

That being said, we perform a certain level of due diligence on authorized signers but it does not rise to the level of full CIP.

Brenda,
I'm referring to the 2010 FinCEN/FFIEC guidance on benficial ownership. They suggest establishing CDD procedures reasonably designed to id & verify beneficial owners, described in part as individuals who have a level of control over funds in the account which enables them to directly or indirectly manage or direct the account. A signer is not necessarily an owner, but until Senator Levin's Incorporation Transparency Act, or a similar one is passed, I am arguing that this will help identify persons able to transfer, therefore control, funds in the account

Any more banks willing to say whether they CIP authorized signers? I'm trying to convince senior management that this is a best practice

We do and always have done CIP on all account signers. The way we look at it, the account signers are really the ones conducting the business

I would no more equate an authorized signer on an entity account as an owner/comtroller of the funds anymore than I would equate a teller that signs a cashier's check an owner/controller of the bank.

We do not do full fledged CIP on authorized signers. We do ask for identification so we can ensure they are who the resolution has authorized to act on the company's behalf.

Our procedures are to get CIP information on signers. This prevents confusion in the New Accounts area.

Since it is procedure, it can be waived by an Officer on a case by case basis (But they are still required to gather "enough information to identify the customer" - this could be a secret code word, DL, something)

Our Policy follows the law, where getting CIP on an authorized signer is not required.

We CIP authorized signers of non-public companies.

We collect CIP on all authorized signers. It also makes it much easier to have all their information in the event a CTR is required.

The "proposed" CIP regulation required banks to identify all signatories, but there were so many bank complaints that the identification requirement was limited to "customers" in the final regulation. Ironically, most banks do identify all signatories because common sense, not the law, still requires it. What good does it do to know a corporation exists if you have no idea who the dude endorsing the check payable to the corporation is?

Regardless, as rlcarey suggests, there is no equation between authorized signers and beneficial owners. If there were, there would be no need for guidance that suggests banks should identify the beneficial owners of high risk accounts.

We CIP all authorized signers. We have had a few rare instances when a signer on a business entity does not want to provide their SSN; but we still confirm their identity otherwise. These instances are very infrequent.

In response to Ken and ricarey, I believe there is potential equation between authorized signers & beneficial owners; since corporate transparency is a huge issue, it is obvious that we currently have no reliable method for determining ownership. A start is identifying those individuals who can empty out the account with the stroke of a pen, which in many cases is in fact a beneficial owner.

We also CIP all authorized signers, and it helps with BSA reporting as mentioned by BSA Rookie.

"I believe there is potential equation between authorized signers & beneficial owners"

You must have went to a different school of math than I did. While I don't have a problem and didn't indicate that I have a problem with anyone that chooses to impose their CIP or some form of CIP on authorized signers, however it does nothing as far as determining beneficial ownership and should not be used as a proxy.

Consider that in some cases a clerk will be an authorized signer on an account. That sure as heck doesn't make him or her a beneficial owner of the corporation, even if s/he can empty the account if so moved.

The problem is that we currently have no method for distinguishing between authorized signers who are owners or clerks. It is safest to get ID on all signers

We require customer due diligence on all executive officers and 25% or more owners (name, address, DOB, ID) for all relationships.

Then you have a severe lack in your due diligence processes. Do you ask your customers that are opening the entity account for a list of owners? Do you review corporate documents to determine ownership capabilities? If all you are doing is CIPing signers, then I would say you are not doing appropriate due diligence.

You might want to review this document:

http://www.fincen.gov/statutes_regs/guidance/pdf/fin-2010-g001.pdf

Reviewing corporate documents is no panacea; to quote from the document you referenced-"...nominal account holders can enable individuals and business entities to conceal the identity of the true owner of assets or property derived from or associated with criminal activity. Moreover, criminals, money launderers, tax evaders, and terrorists may exploit the privacy and confidentiality surrounding some business entities, including shell companies and other vehicles designed to conceal the nature and purpose of illicit transactions and the identities of the persons associated with them. Consequently, identifying the beneficial owner(s) of some legal entities may be challenging, as the characteristics of these entities often effectively shield the legal identity of the owner."

Consequently, identifying the beneficial owner(s) of some legal entities may be challenging, as the characteristics of these entities often effectively shield the legal identity of the owner.

Well that does about says it all. What most of my client do if faced with that type of dilemma is to send the customer down the road to the competitor and let them worry about it.