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#2213813 - 05/16/19 06:57 PM Beneficial Ownership for LLC
Compliance Action Subscriber 1226 Offline
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Joined: Sep 2015
Posts: 153
Person opened an LLC with his wife as signer only - is this still subject to the Control Prong/ownership prong

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#2213816 - 05/16/19 07:05 PM Re: Beneficial Ownership for LLC Compliance Action Subscriber 1226
Adam Witmer Offline
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Joined: Sep 2010
Posts: 2,622
I'm not positive I understand the question, but it seems like you have an LLC that opened a new account. An LLC is an entity that requires verification of both the ownership and the control prong. The signers on the account have nothing to do with the ownership and control of the business/legal entity.
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All statements are my opinion, not those of my employer, and should not be taken as legal advice.
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#2213820 - 05/16/19 07:29 PM Re: Beneficial Ownership for LLC Compliance Action Subscriber 1226
ACBbank Offline
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ACBbank
Joined: Jul 2006
Posts: 4,170
New York City
An LLC is a Legal Entity Customer as defined by the Final Rule.
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#2213821 - 05/16/19 07:30 PM Re: Beneficial Ownership for LLC Compliance Action Subscriber 1226
Compliance Action Subscriber 1226 Offline
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Joined: Sep 2015
Posts: 153
Person that opened the account is the owner and wife is just a signer - so I guess he is the ownership prong and wife is control prong, he owns 100%

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#2213828 - 05/16/19 08:25 PM Re: Beneficial Ownership for LLC Compliance Action Subscriber 1226
BrianC Online
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BrianC
Joined: Nov 2004
Posts: 6,273
Illinois
The Bank should not be deciding this. The final rule states that we ask the person opening the account on behalf of the legal entity who the beneficial owners are.

The person opening the account may state that the 100% owner satisfies both the ownership prong and the control prong.
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#2213830 - 05/16/19 08:29 PM Re: Beneficial Ownership for LLC Compliance Action Subscriber 1226
Compliance Action Subscriber 1226 Offline
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Joined: Sep 2015
Posts: 153
I agree, Brian, the owner satisfies both the ownership prong and the control prong - thanks to all

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#2213902 - 05/17/19 03:43 PM Re: Beneficial Ownership for LLC Compliance Action Subscriber 1226
TryingtoComply Offline
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Joined: Apr 2013
Posts: 1,921
The West
Brian,

I cannot agree with you more. I keep reminding my staff that it is not them that decides who goes on the form. Give the form to the customer and have them complete it. If it seems wrong, then ask questions, but bank employees should not be preparing the form.
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