Purchased loans - CIP/BO/314a/OFAC

Posted By: BSAGal

Purchased loans - CIP/BO/314a/OFAC - 01/25/19 05:59 PM

We are looking into entering an agreement to purchase commercial loans from a non-bank lender (not a covered financial institution). I know it's an asset purchase so it's exempt from CIP. What about beneficial ownership? The legal entity opens the account with the third party, not us the purchasing bank. The third party funds the loan. Third party isn't subject to the rule. Therefore, since again it's an asset purchase and due diligence is required before the account is opened, I don't not believe we have an obligation under the BO rule? Am I looking at this correctly?

Since we will be servicing these loans we will have 314a and OFAC obligations. Is there something in the agreement I should be looking for to see what identification information they will be passing on to us, so that we can book these loans on our system and do the appropriate searches? Is that standard? I have requested a copy of the agreement, but haven't gotten it yet.

Are there other things I need to be thinking about?

Any feedback is greatly appreciated.