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FinCEN (Financial Crimes Enforcement Network) recently released an updated version of its Frequently Asked Questions (FAQ) outline in an effort to assist bankers as they prepare for the May 11 deadline. These expanded due diligence requirements are intended to find out who is really the controlling force of various businesses with which the bank does business, including corporations and limited liability companies.
“A lot of traditional community bankers may not be fully prepared for this new BSA/AML exercise,” OBA President Roger Beverage said. “Moreover, bank customers may not understand that it is the federal government that’s requesting this additional information, not the bank.”
There 37 new FAQs that are intended to build on an earlier set of FAQs issued two years ago. These new FAQs are an effort to address the many questions that have been raised by bankers in the wake of the rule’s adoption
“These additions try to clarify how you are to go about identifying the individuals in entities that have a very complex structure for business reasons,” Beverage said. “We’ve had a number of questions raised about what information you need in order to verify that the owners are who they say they are.
“We are working with the ABA and plan to make some video programs available to bankers, along with other materials that will help bankers explain the ‘whys’ to their customers,” he said. “My guess is there will be period for ‘ramping up’ before a full-throated examination takes place, but that’s all it is – a guess. We think additional information will be forthcoming shortly, and as soon as it’s released, we’ll make sure you have it available.”
Click here to read the 24-page guidance document.