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#2168221 - 03/14/18 07:41 PM Change in Authorized Signers - Event?
Mel in WA Offline
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Posts: 1,186
Do you consider a change in authorized signers to be a triggering event that warrants a Certification of Beneficial Owners?

For example, a bookkeeper is an authorized signer on the business account. She leaves the company and is removed from the account and replaced by the new bookkeeper. Nothing has changed in the ownership structure or TIN. I believe this is not a "new account" per the regulation and a CBO is not required.

However, if the new bookkeeper is now the new control person, a new CBO should be obtained, correct?

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#2168238 - 03/14/18 08:03 PM Re: Change in Authorized Signers - Event? Mel in WA
TryingtoComply Offline
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The West
Yes, if the control person changes.

The better question is do you require the form if neither the BO(s) or CP change. This WILL happen.
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#2168239 - 03/14/18 08:04 PM Re: Change in Authorized Signers - Event? Mel in WA
Elwood P. Dowd Offline
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Would a change in signatories be a logical time to ask for an updated Appendix A? Yes, actually it would be a far more propitious moment for identifying new owners than the opening of a new account.

Our company has not opened a new account in 22 years. However, we have changed signatories twice during that period. Once when we added a new owner and a second time when we deleted that new owner. FinCEN chose a less than logical timing requirement for requiring a new Appendix A.

Should you do it voluntarily? No.

Start out with a program that complies with the regulation, no frills. As has been pointed out by others, your reviewers will feel inadequate if they can't make suggestions, things they will call "best practices" although no such list will exist. If you add bells and whistles up front, their suggestions will be increasingly obscure, but they will still want you to follow their advice.

Don't volunteer to increase the cost and complexity of compliance with a regulation that does nothing. If you do, point out to management what your additions have been.
Last edited by Ken_Pegasus; 03/16/18 10:05 AM. Reason: Reworded
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#2168240 - 03/14/18 08:05 PM Re: Change in Authorized Signers - Event? Mel in WA
BSAN3rd Offline
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Joined: Sep 2016
Posts: 32
I do not consider a change in authorized signers to be a triggering event unless the authorized signer change is due to a change in ownership or control.

So in your example, I would say "No" to beneficial ownership certification being obtained UNLESS your follow-up applies. Then my answer changes to "Yes".

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#2168489 - 03/15/18 08:17 PM Re: Beneficial Owner Change of Address TryingtoComply
ahkcompliance Offline
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Joined: Sep 2008
Posts: 2,470
Midwest
When a business changes signers is anyone using a specific form to review beneficial owner info? Just make sure its reviewed but no new certification unless ownership changed.

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#2168548 - 03/16/18 12:13 PM Re: Beneficial Owner Change of Address Mel in WA
Adam Witmer Online
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Originally Posted By Mel in WA
Do you consider a change in authorized signers to be a triggering event that warrants a Certification of Beneficial Owners?


A change in authorized signers does not require a certification of beneficial owners. Therefore, to me, it does not warrant a new certification in and of itself.

In addition to the points Ken made in getting a certification for a change in authorized signers, you will be opening your bank up for criticism if you make a policy to get it and then don't get it in every case. I'm of the camp that it is best for most to start a program that meets the core rules without going above and beyond. This is an area where regulatory creep is already trying to take over, and when that does, that is going to cost some banks big dollars for (probably) no real benefit.
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#2168665 - 03/16/18 05:18 PM Re: Beneficial Owner Change of Address Mel in WA
RockChucker, CAMS Offline
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Joined: Jul 2013
Posts: 1,657
The Country
I agree with Ken and Adam. Don't make this a bigger pain in the backside then it already is. Read the reg, understand the reg, and follow the reg.
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#2174295 - 04/19/18 05:26 PM Re: Beneficial Owner Change of Address Mel in WA
ahkcompliance Offline
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Joined: Sep 2008
Posts: 2,470
Midwest
I want to circle back on change of signers.

For accounts opened prior to May 11, if a entity changes changes and there is a new control person, should/do we need to get a certification form filled out?

For accounts opened after May 11 and we get a certification form and they later come in to change signers, do we need a new certification if the control person has changed?

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#2174345 - 04/19/18 06:50 PM Re: Beneficial Owner Change of Address ahkcompliance
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Joined: Apr 2017
Posts: 19
Question 13 of the FAQs released on April 3rd addresses existing customers.

Q. Are covered financial institutions required to collect or update beneficial ownership
information on customers with accounts opened prior to May 11, 2018, the Rule’s
applicability date?

A. Financial institutions are not required to conduct retroactive reviews to obtain
beneficial ownership information from customers with accounts opened prior to
May 11, 2018. The obligation to obtain or update beneficial ownership information
on legal entity customers with accounts established before May 11, 2018, is
triggered when a financial institution becomes aware of information about
the customer during the course of normal monitoring relevant to assessing or
reassessing the risk posed by the customer, and such information indicates a
possible change of beneficial ownership

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#2174360 - 04/19/18 07:20 PM Re: Beneficial Owner Change of Address Mel in WA
ahkcompliance Offline
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Joined: Sep 2008
Posts: 2,470
Midwest
I have read that. We haven't identified anyone before so how do we really know if there is a change in ownership.

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#2174367 - 04/19/18 08:19 PM Re: Beneficial Owner Change of Address Mel in WA
BrianC Offline
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BrianC
Joined: Nov 2004
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Illinois
I sit down at a desk. I say to the banker, 'I need to change signers on my account because one of our partners retired and we are adding the new partner."

I'd say you have knowledge that there is a change in ownership.
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#2174379 - 04/19/18 09:53 PM Re: Beneficial Owner Change of Address Mel in WA
TryingtoComply Offline
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Joined: Apr 2013
Posts: 1,965
The West
ahkcompliance,

I know what you mean. However, I have trained our employees to ASK if there has been a change in ownership when there is a request to change signers. This is an opportunity for them to explain the rule and if they learn that there is a change in owners they will explain the 25% threshold and control person.

I've also advised them that changing/adding signers may not always be a trigger event.

Brian's example is a good one.
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#2174413 - 04/20/18 01:19 PM Re: Beneficial Owner Change of Address TryingtoComply
ComplianceNewbie Offline
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Joined: Apr 2017
Posts: 19
Would a change in signers be an indication that a possible change in ownership has occurred? I think the answer to that is yes. Doesn't mean that ownership has changed, but could point to it.

We are using a change in signers as a triggering event. If an existing certification has been collected and is still current and accurate, we will have them sign saying that ownership hasn't changed and the previous certification is still up to date. If not, a new certification will be collected.

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#2174537 - 04/20/18 08:50 PM Re: Beneficial Owner Change of Address Mel in WA
JennKK2 Offline
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Joined: Nov 2006
Posts: 263
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authorized signers UGH trying not to make a mountain out of a mole hill
if i'm reading right above, a bank may decide if an authorized signer is a triggering event and if so then must maintain that same principal going forward; I'm sensing not really advised. we have accounts that have multiple authorized signers. Could be those authorized to sign aren't a control prong in the sense of the definition.
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