ABA Calls for Federal Beneficial Ownership Registry

Ahead of a Senate Banking Committee hearing tomorrow on beneficial ownership, the American Bankers Association wrote to committee members calling for the establishment of a federal registry of beneficial ownership information that banks could use to facilitate compliance with FinCEN’s customer due diligence rule.

Establishing such a registry would help rectify a flaw in the rule by providing a mechanism through which beneficial ownership information provided by customers could be verified, ABA said. “A single federal registry would also help ease the burden on companies because the beneficial ownership information would be located in one place. A company would not be required to provide that information to a financial institution each and every time it opens a new account.”

As Congress considers the creation of a registry, ABA advocated for a phased-in process for existing companies to be incorporated into the database and emphasized that financial institutions should have the authority to access the information without seeking customer permission.