Beneficial Ownership Database Will Facilitate CDD Compliance | 05/05/2021


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CUNA supports the creation of a beneficial ownership information database, as this would shift the burden of collecting beneficial ownership information from credit unions to the Financial Crimes Enforcement Network (FinCEN).

FinCEN has issued an advance notice of the draft regulations regarding beneficial ownership information reporting requirements under the Business Transparency Act (CTA). CTA requires certain legal companies to submit beneficial ownership information directly to FinCEN.

FinCEN will maintain this information in a secure, non-public database accessible by appropriate law enforcement agencies, federal regulatory authorities, and financial institutions subject to Customer Due Diligence (CDD) requirements under the law. on banking secrecy (BSA) and the fight against money laundering (AML requirements).

“Credit unions are very supportive of the creation of the beneficial owner database and believe it will greatly facilitate the fulfillment of customer due diligence obligations under the Banking Secrecy Act (BSA) and its regulations. implementing regulations, ”reads CUNA’s comment letter.

The letter also notes:

  • FinCEN should require reporting companies to provide the same information about beneficial owners that financial institutions are required to collect in order to meet their CDD obligations.
  • Access by financial institutions to information on beneficial owners should be as simple and streamlined as possible. The notification of change of beneficial owner status retrieved from the FinCEN database must be automatically reported to financial institutions;
  • FinCEN should consider an initial beta testing period involving institutions of varying sizes and complexity to identify issues; and
  • As the database is about to be finalized, FinCEN is also expected to offer trainings illustrating how the database works and how to use the information for credit unions.
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