We use a vendor's product for CIP purposes at the bank. When running a sole proprietor account, is there a reason we should be doing the full search or is OFAC alone sufficient? The same would go for unregistered organizations.
I need clarification on the beneficial ownership rule. If we have non-profit or charity accounts that are not legal entities, do we have to do the control prong? What if their paperwork does not have them classified as a corporation or LLC but they have a separate EIN? Do we then do the control prong? And what if the account is very old and they don't have the actual papers stating if they are incorporated, etc. but have a separate EIN? Does the EIN make a difference?
We received an IRS levy for an individual. We have no personal account, but there is an account where the individual is the sole owner on a business account and incorporated. Does the levy effect this account? And do the new Beneficial Ownership regulations impact this at all?
This individual is really using this as a personal account and even deposits Social Security checks into it.
The majority of our IRA customers have their spouse listed as beneficiary. When an IRA holder passed away, we would change the title to the "Spouse as Beneficiary of the deceased IRA" and their SS# if they chose to not treat as their own. We had two IRA holders (in RMD) pass away this year and had multiple children listed as beneficiary. We set up separate accounts for each child as "Beneficiary of the fathers IRA" and transferred the funds to them. This was done "in-house" with transcodes to just transfer
the funds to the separate accounts (no paper work other than the entries). What is the proper way to handle the transferring of accounts like this? Should we have completed new account paperwork for a new IRA account? For CIP purpose?
Based on the change to Texas law Sec. 506.001. CONCEALED HANDGUN LICENSE AS VALID PROOF OF IDENTIFICATION.
(a) A person may not deny the holder of a concealed handgun license issued under Subchapter H, Chapter 4l l, Government Code, access to goods, services, or facilities, except as provided by Section 52l.460,Transportation Code, or in regard to the operation of a motor vehicle, because the holder has, or presents, a concealed handgun license rather than a driver's license or other acceptable form of personal identification.
Does this mean that community banks must accept the concealed handgun license as a primary form of identification? Or can we use it as secondary to other identification and still be within the law?
If an applicant for an account passes all the BSA and CIP qualifications (ID verification, chexsystems, credit report) to open an account, yet the bank employee has an uneasy feeling or is suspicious of their intentions, are we able to decline the applicant for the account? If not, what options do we have to protect the institution from a loss? If so, what should we provide as the reason for the decline on the notice of action letter?
I have a branch that is telling me that a business that is opening an account is syndicated and set-up for tax credit reasons. This is a rather large country-wide real estate developer and I have no information that excludes this type of entity from either the beneficial ownership or control prong requirements. They appear, to me, as just a for profit business as any other. Am I correct in thinking that both prongs apply and no exemptions apply.
If an individual NOT on an account is making only a deposit, are we required to gather CIP information on them?
As I understand the new beneficial ownership rules, certificate of deposit rollovers and loan renewals are treated as new accounts and require beneficial ownership information to be obtained at renewal of the account. Renewed loans are easily taken care of but automatically renewable CDs are not. Unless the CD holder does something new, they do not normally come back to the bank. What is your best advice as to handling automatically renewable CDs and the requirements of beneficial ownership? We are planning to contact these customers prior to the maturity date asking them to come into the bank but this doesn't mean that they will.
What are some common issues with a paper-only approach to CIP recordkeeping?