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Financial Services Law Insights and Observations

FinCEN grants permanent relief from Beneficial Ownership Rule for CDs and certain automatic renewal products

Financial Crimes FinCEN CDD Rule Beneficial Ownership

Financial Crimes

On September 7, the Financial Crimes Enforcement Network (FinCEN) issued a notice granting permanent relief for financial institutions from the Beneficial Ownership Rule’s requirements to obtain and verify the identity of beneficial owners of legal entity customers, with respect to certificate of deposit rollovers (CDs) and loans that renew automatically. The exception applies only to the rollover, renewal, modification, or extension of the following types of accounts occurring on or after May 11, 2018: CDs; existing loans, commercial lines of credit, and credit card accounts that do not require underwriting reviews; and safe deposit box rental renewals. The exception does not apply to the initial opening of these types of new accounts. FinCEN noted that it will not provide any other exception from a financial institution's anti-money laundering compliance obligations under the Bank Secrecy Act.

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