Beneficial Ownership Reporting to FinCEN
Effective January 1, 2024, many companies in the United States must report information to the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) about their beneficial owners – the individuals who ultimately own or control the company. This is a result of a 2021 law passed by Congress – The Corporate Transparency Act.
There are several resources available to help you navigate this new regulation for business owners. They can be found at FinCEN’s beneficial ownership information webpage at: www.fincen.gov/boi.
An Introduction to Beneficial Ownership Information Reporting brochure is also available to assist new businesses with the law.
Beneficial Ownership Requirements for the Bank
When opening a business account, we are legally required to obtain documentation verifying the business and the individuals associated with it. Information required includes the name and other key information on the beneficial owners of a legal entity with more than a 25% ownership interest in the business entity.
Additionally, the representative of the business must also provide the name of at least one person that has control of the business entity. Typically titles indicating control may be ones such as President, Chief Financial Officer, Chief Operations Officer, Managing Member, General Partner, Vice President, and Treasurer, (this listing is not all inclusive and is solely for illustration).
Business entities wishing to open a new account or revise an existing account will be required to provide the information on a specific Certification of Beneficial Owners of Legal Entities form (Opens in a new Window). Any business entity that refuses to provide this information will not be able to open, revise or renew an account with Tennessee State Bank. This requirement for beneficial ownership and control information collection will apply to every type of account that Tennessee State Bank opens, revises or renews such as checking, savings, and money market accounts, certificates of deposit, loans, credit cards, cash management, and safe deposit boxes.
We would also like to take this opportunity to remind our business entity clients of the required documentation necessary to make the account opening, revision or renewal process run smoothly and have included a Setting up your Commercial Account brochure which lists the various documents that will be requested for different entity types opening, revising or renewing accounts with us. We would like to be a resource for you if you have questions about this new legal requirement, please contact us at 865-453-7011 or visit any of our branches for further information.
