- Each individual who directly or indirectly owns 25% or more of the equity interest of a Legal Entity Customer; and,
- A single individual who has significant responsibility to control, manage, or direct a Legal Entity Customer.
As we all work together, Magnolia State Bank will continue to help the U.S. government prevent, detect, and deter any terrorist or illegal activity by requiring the collection of this information and ID documentation each time an account is opened.
If you have any questions about these new account opening requirements for Legal Entities, please contact your local branch office. We greatly appreciate your business and will continue to provide you the best possible service as we transition to complying with the new regulations.
What types of Legal Entities are covered by this regulation?
Legal Entity includes corporations (including non-profit), limited liability companies, or other entities created by a filing of a public document with a Secretary of State or similar office, a general partnership, and any similar business entity formed in the U.S. or a foreign country.
Legal Entity does not include sole proprietorships, unincorporated associations, trusts (with some exceptions), publicly traded companies, and most financial institutions, among others.
Who is a Beneficial Owner?
Each individual, if any, who directly or indirectly owns 25% or more of the equity interest of a Legal Entity customer (e.g. each natural person who owns 25% or more of the shares of the corporation); and,
A single individual who has significant responsibility to control, manage, or direct a Legal Entity Customer (e.g. CEO, CFO, Managing Member, General Partner, President, VP, or Treasurer) or any other individual who regularly performs similar functions.
Who has to complete the Certification of Beneficial Owner(s) form?
The person opening an account on behalf of a Legal Entity, as long as that individual has significant managerial control of the Legal Entity or regularly performs similar functions.
What information does the form require?
Name, address, date of birth, and Social Security Number (or passport number or other similar information in the case of Non-U.S. person) for all beneficial owners.
When must the form be completed?
Prior to opening all deposit and loan accounts, including credit cards, for both new and existing Legal Entity customers.
Must the Bank verify the percentage of ownership on Legal Entities?
The Bank may rely on the Certification of Beneficial Owner(s), unless it has actual knowledge that any of the information is incorrect (i.e. not consistent with Secretary of State documentation or Operating or Partnership agreements).
Must the Bank verify the accuracy of the information collected on each individual?
Yes, the Bank is required to verify name, address, date of birth, and Social Security Number for all beneficial owners. We will ask for a copy of Driver’s License and/or other ID documentation.
Must Legal Entities notify the Bank of changes in beneficial ownership?
Typically this information is required only at the time of account opening, however, the Bank may require updated information on existing accounts in certain instances.