New Customer Due Diligence Rules for Beneficial Ownership: Implementation Game Plan

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Friday, September 23, 2016

8:00 am – 9:30 am PT
9:00 am – 10:30 am MT
10:00 am – 11:30 am CT
11:00 am – 12:30 pm ET

On May 5, 2016, the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) issued final rules on customer due diligence requirements for banks, credit unions, and other covered institutions. The new rule adds a fifth pillar to the four pillars of an anti-money laundering program. Effective May 11, 2018, finding beneficial owners of legal entity customers will become a legal requirement.

Why worry now? This sweeping change will require significant time and resources to fully understand the rule and its impact on your financial institution’s policies, procedures, forms, monitoring processes, and ongoing due diligence responsibilities. While regulators can’t require early compliance, they can and will expect to review how well your financial institution understands the changes and the efforts being made to develop a successful implementation plan. There are no grandfathering features and the new rules will be triggered each time a “legal entity” opens a loan, deposit, or escrow account.

Continuing Education: Attendance verification for CE credits upon request


  • What is in the final rule?
  • What is the definition of a legal entity, what is the coverage, and what are the exclusions?
  • What’s involved in the two-prong test for ownership and control?
  • Compliance challenges include:
    • Reliance on beneficial ownership information supplied by customers
    • Collecting beneficial ownership information on existing customers
    • Heightened expectations for uses of beneficial ownership information
  • Model certification form issues
  • What’s expected in risk-based procedures for conducting ongoing customer due diligence?
    • Understanding the nature and purpose of customer relationships for the purpose of developing a customer risk profile
    • Conducting ongoing monitoring:
      • Identifying and reporting suspicious transactions
      • Maintaining and updating customer information on a risk basis

    • Sample new CDD policy
    • Sample checklist to prepare for the changes
    • Interview questions for account opening
    • Employee training log
    • Quiz you can administer to measure staff learning and a separate answer key


This informative session is designed for BSA officers, BSA personnel, deposit operations staff, branch personnel, risk managers, compliance officers, new account staff, and auditors.

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