Important Information for Commercial Customers

Beneficial Ownership

In May 2016, the U.S. government passed a new regulation under the Bank Secrecy Act regarding beneficial ownership of legal entity customers. Download a Beneficial Ownership FAQ in PDF format by clicking here.

 

Why We Need this Information

Effective May 11, 2018, it will be mandatory for all financial institutions to comply with this regulation by identifying:

  • Beneficial Ownership prong: each individual that ultimately has 25% or more Beneficial Ownership in the Legal Entity; and
  • Control prong: one individual that has Significant Managerial Control of the Legal Entity.

 

Understanding Beneficial Ownership

The new regulation impacts all covered Legal Entities opening or maintaining accounts at any financial institution.

Covered Legal Entities include:

  • Corporations
  • Limited Liability Companies (LLCs)
  • Limited Partnerships (LPs)
  • General Partnerships
  • Business Trusts
  • Incorporated Charities*
  • Nonprofits*
  • Non-excluded Pooled Investment Vehicles*

*Exempt from Beneficial Ownership prong but not the Control prong.

Entities fully exempt from the rule include:

  • Natural Persons opening an account for personal use
  • Sole Proprietors
  • Unincorporated Associations
  • Trusts not formed via State filing
  • Government Entities
  • Publicly Traded Entities
  • Bank Holding Companies
  • Companies registered with the Securities and Exchange Commission (SEC)
  • Investment companies, investment advisers (registered with SEC)
  • Public accounting firms that audit publicly traded companies/SEC-registered broker-dealers

 

Information Organizations Will Need to Provide

When opening an account on behalf of a Legal Entity, the bank will request information that identifies the ultimate Beneficial Owner(s) and Controlling Person of the Legal Entity (name, address, date of birth, social security number as well as other identification documents).
 
The organization will be responsible to certify that this information is true and accurate.
 
This information will need to be collected whether or not the person identified is a Mars Bank customer.

Questions? Contact the Mars Bank Commercial Banking team. Download a Beneficial Ownership FAQ in PDF format by clicking here.