WASHINGTON—Credit unions now have less than six months to come into compliance with the Financial Crimes Enforcement Network's (FinCEN) Customer Due Diligence (CDD) rule, effective May 11, 2018, reminded CUNA.
The rule includes provisions that address identifying the beneficial owners of legal entity accounts and financial institutions’ anti-money laundering (AML) programs.
CUNA noted that the new beneficial owner requirements include:
- Identification and verification of beneficial owners of legal entity members
- A new certification form requirement
- Written procedures
- Record keeping
- Record retention
New AML requirements include:
- A system of internal controls to assure ongoing compliance
- Independent testing for compliance to be conducted by credit union personnel or outside parties
- Designation of an individual or individuals responsible for coordinating and monitoring day-to-day compliance
- Training for appropriate personnel
- Appropriate risk-based procedures for conducting ongoing member due diligence
“NCUA’s Bank Secrecy Act (BSA)/AML regulations currently require the first four bullets, and the fifth bullet reflects existing practices necessary to satisfy suspicious activity reporting (SAR) obligations,” CUNA explained.
CUNA has developed a number of tools to assist credit unions, including a CDD checklist, final rule summary and CDD compliance chart.