What is the beneficial ownership regulation and why does it matter?
The beneficial ownership regulation is a federal law requiring all financial institutions to identify and verify the identity of the beneficial owners of legal entity customers as well as a controlling person of the legal entity anytime an account or loan is opened or maintained. The regulation is aimed at making financial institutions safer for their customers and protecting the country’s financial system.
Why has Home Bank been asked to collect this information?
Home Bank, as well as all other financial institutions in the U.S., will be required to collect beneficial ownership information. The U.S. government implemented the new beneficial ownership regulation to help fight financial crimes. Home Bank is doing its part in upholding the new regulation to protect the financial system. Compliance with regulations has always been of utmost importance to Home Bank, and the new beneficial ownership regulation will be treated with the same level of importance.
Is Home Bank the only bank that is required to collect beneficial ownership information?
No. All financial institutions are required to comply with the new regulation and will be collecting this beneficial ownership information from applicable customers.
What information does a Legal Entity need to provide?
The beneficial owner final rule expands upon the 2003 Customer Identification Program requirements which required the collection of and verification of customer name, date of birth, address and tax identification number.
The extension includes the identification of those natural persons defined as beneficial owners of a legal entity. Beneficial owners can be defined in two ways:
- Ownership: Each individual who, directly or indirectly, owns 25% or more of the equity interests of the legal entity customer.
- Control: One individual with significant responsibility to control, manage or direct the legal entity customer, and their corresponding title (e.g. Chief Executive Officer, Chief Operating Officer, President, Vice President, and Managing Member).
What documentation is collected on an identified Beneficial Owner?
Beneficial ownership information will be collected at account opening for new accounts and anytime a beneficial owner of the legal entity changes.
Information required for the Ownership and Control individuals include:
- Full Name
- Date of birth
- Address (residential or business street address, no P.O. Boxes)
- Social security number or ITIN (for U.S. persons or permanent resident aliens)
- In lieu of SSN or ITIN, primary identification number can be used (for non U.S. persons)
- Percentage of ownership (ownership)
- Title (control)
- State issued ID for any beneficial owner/control individual who is not present
Verification of unexpired, government-issued identification bearing a photograph, evidencing nationality or residence.
The natural person opening the account or loan on behalf of the legal entity will be required to be an authorized signer and sign a certification form attesting that the information provided on beneficial ownership is complete and correct.
How will the change impact my existing accounts?
The change should not impact your existing accounts or loans. However, please be aware that your Home Bank representative may reach out for beneficial ownership information to update your account file, ensuring necessary compliance for any future financial requests.
What if the people who have been identified as beneficial owners or control persons are not clients of Home Bank? Do I still need to provide their personal information to Home Bank?
Yes. Regardless of customer status, information about the ultimate beneficial owners and control person must be provided in order to comply with the regulation.
My Home Bank banker has asked me for a Certification of Beneficial Ownership. What is this and why is it necessary?
The Certification of Beneficial Ownership is a legally required form that Home Bank must collect from legal entity customers regarding their ultimate beneficial owners and the control person. By completing the form, you are attesting that the information provided is accurate to the best of your knowledge.
Where will beneficial ownership data be stored?
Home Bank will maintain beneficial ownership information in its system of record. We maintain strict privacy policies and procedures. Any client information, including beneficial ownership information, will not be shared.
Will the information I provide for beneficial ownership be used for marketing to prospects that do not already have a relationship with Home Bank?
No. This information will not be used for marketing or prospecting purposes.
How do I get beneficial ownership information back to my banker?
Beneficial ownership information will be collected using internal bank documents and should be returned to your Home Bank representative. Forms are also available online at Home24Bank.com.
Given the sensitive nature of the information that is being provided for beneficial ownership, can I provide the details directly to my Home Bank representative?
Yes. If you are more comfortable providing information in person, please reach out to your Home Bank representative directly.
I also have personal accounts with Home Bank. Will Home Bank also collect beneficial ownership information for my personal accounts?
No, the beneficial ownership rule does not apply to individuals.