Financial Crimes Enforcement Network grants exceptive relief from repeated beneficial owner checks when existing legal entity customers open new accounts

The Financial Crimes Enforcement Network (FinCEN) issued an order granting exceptive relief to covered financial institutions from parts of its 2016 Customer Due Diligence (CDD) rule, removing the requirement to identify and verify the beneficial owners of a legal entity customer each time that customer opens a new account. Under the order, institutions must identify and verify beneficial owners only when a legal entity customer first opens an account, when the institution learns facts that reasonably call into question the reliability of previously obtained beneficial ownership information, or as otherwise required under the institution’s risk-based procedures for ongoing customer due diligence. All other applicable Bank Secrecy Act anti-money laundering and countering the financing of terrorism obligations remain in place, including ongoing monitoring to identify and report suspicious transactions and, on a risk basis, maintaining and updating customer information.