Are we required to confirm that our business customers are registered with the Secretary of State? Are there any concerns if we allow a business to maintain a deposit account after it has been voluntarily or involuntarily dissolved, or if a business loan customer is voluntarily or involuntarily dissolved?

No, we are not aware of any law or regulation requiring your bank to determine whether a business customer is in good standing with the Illinois Secretary of State or the secretary of state of any other state. However, you may wish to review your commercial account agreements and loan agreements to determine if they require a customer to remain in good standing under applicable laws.

The Customer Identification Program (CIP) rules do not require your bank to obtain a copy of a business customer’s state registration for purposes of opening an account. The CIP rules require only that you document the business customer’s identity — for example, by obtaining its certified articles of incorporation or articles of organization — when opening the account.

However, we believe it is common for commercial account agreements and loan agreements to require a commercial customer to remain in good standing under applicable laws. Our impression is that while most depository institutions do not actively monitor the legal status of their commercial customers, when they do discover a problem with the legal status of a commercial customer, they bring the issue to the customer’s attention. In most cases, the customer quickly resolves the issue.

In Illinois and certain other states, if a business is involuntarily dissolved (for failing to pay a filing fee, for example), its legal status can be reinstated by resolving the problem that caused the dissolution, and the business will be deemed to have continued in existence throughout the period of dissolution as if it had never been dissolved. In addition, claims against a dissolved business that is not reinstated remain valid for a period of time after the dissolution, the length of which varies depending on whether notice of the dissolution is provided.

For resources related to our guidance, please see:

CIP Rules, 31 CFR 1020.220(a)(2)(ii)(A)(2) (“For a bank relying on documents, the CIP must contain procedures that set forth the documents that the bank will use. These documents may include: . . . (2) For a person other than an individual (such as a corporation, partnership, or trust), documents showing the existence of the entity, such as certified articles of incorporation, a government-issued business license, a partnership agreement, or trust instrument.”)

FFIEC BSA/AML Examination Manual, Business Entities (Domestic and Foreign) — Overview (“Required account opening information may include articles of incorporation, a corporate resolution by the directors authorizing the opening of the account, or the appointment of a person to act as a signatory for the entity on the account.”)

Illinois Business Corporation Act of 1983, 805 ILCS 5/12.45(d) (“Upon the filing of the application for reinstatement, the corporate existence for all purposes shall be deemed to have continued without interruption from the date of the issuance of the certificate of dissolution, and the corporation shall stand revived with such powers, duties and obligations as if it had not been dissolved; and all acts and proceedings of its shareholders, directors, officers, employees, and agents, acting or purporting to act in that capacity, and which would have been legal and valid but for such dissolution, shall stand ratified and confirmed.”)

Illinois Business Corporation Act of 1983, 805 ILCS 5/12.75 (“Known claims against dissolved corporation.

(a) A dissolved corporation may bar any known claim against it . . . by following the procedures set forth in subsections (b) and (c) of this Section . . .

(b) Within 60 days from the effective date of dissolution, the dissolved corporation shall send a notification to the claimant setting forth the following information: . . . (3) The deadline, not less than 120 days from the effective date of dissolution, by which the dissolved corporation must receive the claim.”)

Illinois Business Corporation Act of 1983, 805 ILCS 5/12.80 (“The dissolution of a corporation either (1) by filing articles of dissolution in accordance with Section 12.20 of this Act, (2) by the issuance of a certificate of dissolution in accordance with Section 12.40 of this Act, (3) by a judgment of dissolution by a circuit court of this State, or (4) by expiration of its period of duration, shall not take away nor impair any civil remedy available to or against such corporation, its directors, or shareholders, for any right or claim existing, or any liability accrued or incurred, either prior to, at the time of, or after such dissolution if action or other proceeding thereon is commenced within five years after the date of such dissolution. Any such action or proceeding by or against the corporation may be prosecuted or defended by the corporation in its corporate name. This provision does not extend any applicable statute of limitations.”)

Illinois Limited Liability Company Act, 805 ILCS 180/35-40(d) (“Upon the filing of the application for reinstatement, the limited liability company existence shall be deemed to have continued without interruption from the date of the issuance of the notice of dissolution, and the limited liability company shall stand revived with the powers, duties, and obligations as if it had not been dissolved; and all acts and proceedings of its members, managers, officers, employees, and agents, acting or purporting to act in that capacity, and which would have been legal and valid but for the dissolution, shall stand ratified and confirmed.”)

Illinois Limited Liability Company Act, 805 ILCS 180/25-45 (“Known claims against dissolved limited liability company.

(a) A dissolved limited liability company may dispose of the known claims against it by following the procedure described in this Section.

(b) A dissolved limited liability company shall notify its known claimants in writing of the dissolution. The notice must: . . . (3) state the deadline for receipt of the claim, which may not be less than 120 days after the date the written notice is received by the claimant.”)

Illinois Limited Liability Company Act, 805 ILCS 180/25-50 (“Other claims against dissolved limited liability company.

(a) A dissolved limited liability company may publish notice of its dissolution and request persons having claims against the company to present them in accordance with the notice.

(b) The notice must: . . . (3) state that a claim against the limited liability company is barred unless a proceeding to enforce the claim is commenced within 5 years after publication of the notice.”)