We use reports from Chex Systems to check signers on business accounts. If the signer fails can we open the business account?
It depends on what your procedures say. Usually, this means you may still open the business but not have that person sign on the account. There are so many issues here to address. How do we get the signer to let the business know they cannot sign? Can an officer of the institution override CIP requirements? Why does it matter anyway since the business is responsible and not the signer? You may want to re think some of these practices and why you are doing them to begin with. In many cases, checking on individuals may violate the Fair Credit Reporting Act.
Learn more about Deborah's webinar Opening Entity Accounts (updated for the new CDD rules)