The US Department of the Treasury’s Financial Crimes and Enforcement Network (FinCEN), on July 30, released proposed rules that would require banks and other financial institutions to learn and verify the identity of the beneficial owners of their legal entity clients.
The new “customer due diligence” (CDD) requirement to would require institutions to identify individuals that control a legal entity client or that own more than 25 percent equity in the entity.
FinCEN states that benefits of CDD include “assisting law enforcement in identifying the true owners of assets and their true tax liabilities,” and advancing national commitments made to foreign counterparts under FATCA.
Comments on the draft rules will be accepted until 60 days after the date the rules are published in the Federal Register. Notice of proposed rulemaking, release
