In May 2016, the U.S. government passed a new regulation regarding the beneficial ownership of legal entity customers. Going forward, it will be mandatory for all financial institutions to comply with this regulation by identifying the ultimate beneficial owner(s) and a controlling person of a legal entity customer opening or maintaining an account.
In compliance with this new regulation, Oostburg State Bank will collect beneficial ownership information from legal entity customers. This means that any time an account is opened or maintained for a legal entity, we will request information that identifies the ultimate beneficial owner(s) and controlling person of the legal entity. The required identifying information includes name, address, date of birth, identification number, and other information that will help identify those individuals. This information will need to be collected whether or not the person identified is a Oostburg State Bank customer. This information will also be collected for existing legal entity customers who establish or maintain accounts.
While we understand the information requested is personal and sensitive, we need to obtain this information in order to comply with the regulation. As always, we will treat all information collected with the utmost care. All information will be stored securely and handled with the same standard of privacy that we have always maintained.
What you need to know about Beneficial Ownership
- The new regulation impacts all legal entities opening or maintaining accounts at any financial institution.
- Legal entities will need to identify and attest to all ultimate beneficial owner(s) that meet specific requirements as well as a controlling person (e.g., Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, Managing Member, General Partner, President, Vice President or Treasurer).
- Oostburg State Bank will collect information regarding the ultimate beneficial owner(s) and control person of legal entities whether or not they have a personal relationship with the financial institution.
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Frequently Asked Questions
The U.S. government regulation defines “beneficial ownership” as being made up of two roles: (1) those that have a 25% or more ownership interest in a legal entity, and (2) a person with significant managerial control or influence over a legal entity customer (e.g., CEO, CFO, COO, Managing Member, General Partner, etc.)
For every legal entity customer subject to beneficial ownership, you must identify one control person.
NOTE: It is possible that the control person may also be an ultimate beneficial owner.
What if the people who have been identified as beneficial owners or control persons are not clients of Oostburg State Bank? Do I still need to provide their personal information to Oostburg State Bank?
I also have personal accounts with Oostburg State Bank. Will Oostburg State Bank also collect beneficial ownership information for my personal accounts?
If I am a legal entity client and I have a certificate of deposit (CD) account, what do I need to do?
Please contact your Oostburg State Bank representative prior to the date of your CD’s maturity to add beneficial ownership information to your account. Additionally, if your beneficial information changes in the future, you will be required to notify Oostburg State Bank. If we do not receive this information by the renewal grace period, we will be required to close your CD account and send a check for the account balance to the address we have on file.
This document from FinCEN provides information on FAQs regarding Beneficial Ownership.
For more information about Beneficial Ownership, or anything else relating to your accounts, please contact us.