Frequently Asked Questions - Beneficial Ownership



In May 2016, the U.S. government passed a new rule regarding the beneficial ownership of legal entity customers. Going forward, it will be mandatory for all covered financial institutions to comply with this rule by identifying the beneficial owner(s) and a control person of a covered legal entity customer opening or maintaining an account.

In compliance with this new rule, Golden Valley Bank will collect beneficial ownership information from legal entity customers starting in the second quarter of 2018. This means that any time an account is opened or maintained for a legal entity, we will request information that identifies the beneficial owner(s) and a control person of the legal entity. The required identifying information includes, name, address, date of birth, social security number, identification number, and other information that will help identify those individuals. This information will need to be collected whether or not the person identified is a Golden Valley Bank customer. This information will also be collected for existing legal entity customers who establish or maintain accounts once this new rule is implemented at Golden Valley Bank in the second quarter of 2018.

While we understand the information requested is personal and sensitive, we need to obtain this information in order to comply with the law. As always, we will treat all information collected with the utmost care. All information will be stored securely and handled with the same standard of privacy that we have always maintained.

What you need to know about Beneficial Ownership

All covered financial institutions are subject to the Beneficial Ownership Rule under the Bank Secrecy Act.

If your business is a covered Legal Entity under this rule, it will impact your business when opening an account, a loan or if there are changes made to the structure or ownership of your account(s) or business.

We appreciate your business and are committed to providing you with extraordinary service for years to come.

Q & A’s on Beneficial Ownership

Q: What is the beneficial ownership regulation and why does it matter?

A: The beneficial ownership rule is a federal law, requiring all covered financial institutions to identify and verify the identity of the beneficial owners of legal entity customers as well as a control person of the legal entity anytime an account is opened or maintained. The rule is aimed at making financial institutions safer for their customers and protecting the country’s financial system.

Q: Why has Golden Valley Bank been asked to collect this information?

A: Golden Valley Bank, as well as all other covered financial institutions in the U.S., will be required to collect beneficial ownership information. The U.S. government implemented the new beneficial ownership rule to help fight financial crimes. We are doing our part in upholding the new rule to protect the financial system. Compliance with regulations has always been of utmost importance to us, and the new beneficial ownership rule will be treated with the same level of importance.

Q: Is Golden Valley Bank the only bank that is required to collect beneficial ownership information?

A: No. All covered financial institutions in the U.S. are required to comply with the new beneficial ownership rule and will be collecting beneficial ownership information from covered legal entities.

Q: What constitutes beneficial ownership?

A: The rule defines “beneficial ownership” as being made up of two roles: (1) those that have an ownership interest in a legal entity and (2) those that control a legal entity.

The Rule defines beneficial owner(s) as each of the following:

Each individual, if any, who directly or indirectly, owns 25% or more of the legal entity. (i.e., the ownership prong); AND
One individual who has significant managerial control of the legal entity. (i.e., the control prong)
A legal entity will have a total of between one and five beneficial owners.
(i.e., one person under the control prong and zero to four persons under the ownership prong).

Note: It is possible that the control person may also be a beneficial owner.

Q: How will the change impact my existing accounts?

A: This new rule does not impact your existing accounts or loans. However, if there are changes to the ownership or structure of an existing account or loan, we must also obtain, verify and record required identification information.

Q: What if the people who have been identified as beneficial owners or control persons are not clients of Golden Valley Bank? Do I still need to provide their personal information to Golden Valley Bank?

A: Yes. Regardless of customer status, information about the beneficial owner(s) and control person must be provided in order to comply with the rule.

Q: My Golden Valley Bank representative has asked me for a Certification of Beneficial Ownership. What is this and why is it necessary?

A: The Certification of Beneficial Ownership is a form that Golden Valley Bank uses to collect from legal entity customers, regarding their beneficial owner(s) and the control person. By completing the form, you are attesting that the information provided is accurate to the best of your knowledge.

Q: Where will beneficial ownership data be stored?

A: Golden Valley Bank will maintain beneficial ownership information in its system of record. We maintain strict privacy policies and procedures. Any client information, including beneficial ownership information, will not be shared.

Q: Will the information I provide for beneficial ownership be used for marketing to prospects that do not already have a relationship with Golden Valley Bank?

A: No. This information will not be used for marketing or prospecting purposes.

Q: How do I get beneficial ownership information to a Golden Valley Bank representative?

A: A Beneficial Ownership form will be provided by Golden Valley Bank to be completed and returned to your Golden Valley Bank representative.

Q: Given the sensitive nature of the information that is being provided for beneficial ownership, can I provide the details directly to my Golden Valley Bank representative?

A: Yes. If you are more comfortable providing information in person, please reach out to your Golden Valley Bank representative directly.

Q: I also have personal accounts with Golden Valley Bank. Will Golden Valley Bank also collect beneficial ownership information for my personal accounts?

A: No. The Beneficial Ownership rule only applies to legal entity accounts.

For more information on beneficial ownership, please visit us or call 530-894-1000.


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