An updated federal regulation was put into effect for all financial institutions that requires them to identify and verify the individuals, also known as beneficial owners, who control the legal entity that is opening any new account. This means that all legal entity customers who want to open accounts such as deposits, loans, or safe deposit boxes will be impacted by the law.
A “beneficial owner” is defined as someone having: 1) ownership; and 2) control. The ownership includes each individual, if any, who directly or indirectly owns 25 percent of the equity interests of the legal entity customer. The control includes a single individual who has significant responsibility to control, manage, or direct a legal entity customer. This can include an executive officer or any other individual who regularly performs similar functions.
To identify beneficial owners, financial institutions provide the person opening your business account with a “Certification Form” to complete. On the form, the individual representing your business will need to provide the names and information outlined below of the ultimate beneficial owners of the business.
What Is Needed:
- A completed Certification Form by the individual opening the account on behalf of the business.
- For each Beneficial Owner:
- A copy of an unexpired government issued ID with a current physical address.
- A social security number from each beneficial owner.
- Any other documentation requested by the financial institution.
These requirements will need to be met for each new account you open for your business. By having this information available at the time of opening a new account it can help ensure a smoother process. If you have questions on this new regulation contact Peoples at 888.929.9902 and we will be able to guide you through this new process.