FinCEN Extends Temporary Exception to Application of Customer Due Diligence/Beneficial Ownership Rule

General information

Last Spring, The Federal Financial Institutions Examination Council (FFIEC) issued examination procedures for the Financial Crimes Enforcement Network (FinCEN) rule that requires banks, as part of their anti-money laundering program, to develop and implement appropriate risk-based policies, procedures and processes  for (1) conducting ongoing customer due diligence and (2) that are reasonably designed to identify and verify beneficial owner(s) of  legal entity customers. In response to banker concerns, FinCEN issued an administrative ruling to provide a 90-day limited exception to compliance with the requirement to identify and verify beneficial ownership information for certificate of deposit and loan accounts that automatically rollover or renew AND that were established before the Beneficial Ownership Rule’s Applicability Date (May 11, 2018).  

The exception was due to expire on August 9, 2018, however the expiration date has now been extended to September 8, 2018. 

The administrative ruling extending the expiration date can be reviewed here.