In 2016, the U.S. government passed new regulation that required financial institutions to obtain, verify and record information about the beneficial owners of legal entity customers. Starting in 2018, it will be mandatory for all financial institutions to comply with this regulation by identifying the beneficial owner(s)—the individuals who own or control the entity doing business with Envision Bank.
The required identifying information includes name, address, date of birth, identification number, and other information that will help identify those individuals. This information will need to be collected on our certification form whether or not the person identified is a customer of Envision Bank.
While we understand the information requested through beneficial ownership is sensitive, it is required in order for us to comply with the law. As always, we will treat all information collected with the utmost care. All information will be stored securely and handled with the same standard of privacy that we have always maintained.
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 is opened or maintained. The regulation is aimed at making financial institutions safer for their customers and protecting the country’s financial system.
Envision 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. Envision 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 Envision Bank, and the new beneficial ownership regulation will be treated with the same level of importance.
The U.S. government regulation defines “beneficial ownership” as being made up of two roles: (1) those that have an ownership interest in a legal entity and (2) those that control a legal entity.
For those people who have an ownership interest in the legal entity, Envision Bank is required to identify and collect personal information on anyone that meets or exceeds the following ownership thresholds:
A natural person having 25 percent or more of the equity interests of a legal entity.
A person with significant managerial control or influence over a legal entity customer (e.g., Chief Executive Officer, Chief Financial Officer, Managing Member, General Partner, etc.)
For every legal entity client subject to beneficial ownership, you must identify one control person. Generally, this is the individual who has the authority to act on behalf of your legal entity to make decisions related to financial relationships.
NOTE: It is possible that the control person may also be a beneficial owner.
For each person named on the certification, we are required to obtain their legal name, physical address, date of birth, and social security (SSN). If they are not a U.S. citizen, then an unexpired passport may be provided in lieu of the SSN. Additionally, we will need a copy of an unexpired government-issued ID, like a driver’s license or passport, for verification of each named individual.
Envision Bank may reach out for beneficial ownership information to update your account relationship file, ensuring necessary compliance for any future financial requests.
There are a few exceptions to the collection of beneficial ownership information. It is not required to be collected for government agencies, publicly traded companies, sole proprietorships, or voluntary unincorporated associations (i.e., youth sports leagues or scout troops). However, in certain circumstances the control information may still be required.
Indirect ownership means your legal entity may be owned by one or more legal entities. We are required to obtain information on the individual persons behind those layered entities who ultimately have the equivalent of 25 percent or more ownership of your legal entity.
Yes. You would simply notate on the form indicating that there are no individuals with beneficial ownership of 25 percent or more and complete the section for the individual with significant management responsibility.
The individual requesting the account be opened or the loan be granted is the person to complete the certification. This could be the same individual named as the individual with significant management responsibility, or someone who has been designated by that individual to establish bank relationships on behalf of your legal entity. Either way, the person who completes the certification will sign it indicating the information is accurate to the best of his or her knowledge.
No. This information will not be used for marketing or prospecting purposes.
We are required to maintain this information as part of our records that are associated with your legal entity.