Topic: Account Opening
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If a foreign business is opening an account, should we require that the business register with the state of Illinois?
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If the company is not “transacting business” in Illinois, it may not be required to register. The Illinois Business Corporation Act of 1983 requires any corporation that was not organized in Illinois to register with the Secretary of State before it “transacts business” in Illinois. 805 ILCS 5/13.05. (Certain insurance companies must instead obtain a…
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Are we required to collect social security numbers and addresses of the beneficiaries on payable on death accounts?
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We agree that the Customer Identification Program (CIP) regulations do not require you to obtain the social security number of payable on death (POD) beneficiaries. Under those rules, your CIP procedures must (at a minimum) collect and verify certain identifying information about your customers, including taxpayer identification numbers. 31 CFR 1020.220(a)(2). However, the term “customer”…
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What documentation should we require when a business incorporated in a foreign country (Turks and Caicos Islands) opens an account at the bank?
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The FFIEC’s BSA/AML Examination Manual includes a concise treatment of the risk factors and possible risk mitigation steps related to business entities. Business Entities (Domestic and Foreign)—Overview. For any foreign businesses, you will have to conduct individual risk assessments before opening the business account. The assessment should review “the domestic or international jurisdiction where the…
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What procedures should we follow in opening a deposit account for a foreign business (outside of the country)?
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The FFIEC’s BSA/AML Examination Manual includes a concise treatment of the risk factors and possible risk mitigation steps related to business entities. Business Entities (Domestic and Foreign)—Overview. While we would not disagree that foreign businesses are risky customers, the Manual could also help you to identify the least-risky foreign businesses. The Manual describes two kinds…
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What is the extent of a bank’s duty to determine whether an authorized signer has the authority to sign on behalf of a business?
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The Customer Identification Program (CIP) regulations provide specific guidance on developing policies for opening new corporate accounts. They require that you have a policy which requires you to collect the following information from customers: (1) name, (2) date of birth (for individuals), (3) address (principal place of business, local office, or other physical location), and…
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Do we need to collect taxpayer identification numbers from a joint account holder if the customer is not the primary owner of the account?
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We believe that a bank must obtain taxpayer identification numbers (TINs) when any customer opens an account, regardless of the customer’s status as to a joint account. Whether the bank needs to obtain a taxpayer identification number when an existing customer opens a new account is up to the bank. When a customer opens a…
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Local municipalities would like to open accounts (checking, EDAs). What documentation is necessary? For example, how do you confirm the elected officers?
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The answer to your question will be driven by your bank’s own policies and procedures. Similar to the case of opening business accounts, many banks have a written policy requiring a copy of a resolution adopted by the governmental unit’s board of trustees that grants authority to one or more individuals to open the account…
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When we open a payable on death (POD) account, should the account’s title indicate that it is a POD account?
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Under the Illinois Trust and Payable on Death Accounts Act, a POD account is formed when the person(s) opening or holding the account sign an agreement with the institution providing that on the death of the last surviving person designated as a holder of the account, the account will be paid to or held by…