When a legal entity signs a contract for ACH Origination or Merchant Capture, does this trigger the beneficial ownership rules and require verification and the certification form? Basically, would this fall within the definition of a new account?

We are considering those triggering events as we count the amount in their outstanding obligation to the Bank.

FinCEN has told me twice that cash management services such as ACH origination or merchant capture are considered new accounts. I asked twice to make absolutely sure they understand exactly what I was asking. That said, our cash management person did some research and it appears other banks have been told they're NOT considered new accounts. I can only go by what FinCEN told us, so that's what we're doing.

What was FinCEN's reasoning? In both instances, you already have an existing account with the customer. These are ancillary services that cannot be offered without an account.

See this thread: Beneficial Ownership & Cash Managment Services https://www.bankersonline.com/forum/ubbt...ces#Post2167727

For ACH, most banks do a credit write up similar to what they would do on a loan and would include information concerning beneficial owners. Same for merchant services if the bank is guaranteeing the customer rather than simply referring the customer to the company that offers the services.

What we are talking about here is OBTAINING the CBO form vs. having the information regarding beneficial owners on file.

I agree with TryingtoComply that ACH or merchant capture are not new accounts for most financial institutions as they are actually services tied to an actual account. These services may be tied to an account that is opened at the same time as the service, but the service itself is not an account (unless, of course, a bank does not require an account to utilize the service).

(1)Account means a formal banking relationship established to provide or engage in services, dealings, or other financial transactions including a deposit account, a transaction or asset account, a credit account, or other extension of credit. Account also includes a relationship established to provide a safety deposit box or other safekeeping services, or cash management, custodian, and trust services.

That said, I could see these services being part of a triggering event, such as P*Q described.

They gave me no reasoning other than to say these services fit the definition of a new account. I made sure to lay out the scenario as an existing customer with deposit accounts adding CM for the first time, and an existing customer with deposit accounts and CM services adding another CM service, like RDC, etc. They told me it's a new account in both cases.

Your only chance for getting an answer that reflects comprehension is to submit the question in writing and to explain what the addition of these services does and does not entail; i.e. compare what you do in these circumstances to what you do when you actually do open a new account.

Voluntarily creating a list of triggering events makes no sense to me, but following advice that is based on a lack of understanding is just wasteful.

I would do what Ken said and include the definition of a new acount that Adam linked in #2177096 . Maybe something will click once they see that.