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Beneficial Ownership Requirements Overview

Your business relationship is important to us.  Our goal is to make the business account process an efficient and enjoyable experience for you.  Effective May 11, 2018, all financial institutions are subject to new rules under the Bank Secrecy Act imposed by the United States Department of Treasury.  This new federal requirement is aimed at making financial institutions safer for their customer and protecting the country's financial system.

The Beneficial Owner Form

When opening a lending, deposit, or safe deposit box account for a covered Legal Entity at HCN Bank, we will be required to ask you for identifying information (Name, Physical Residential Address, Date of Birth, and Social Security), as well as identification documentation for:

  • EACH individual that has 25% or more Beneficial Ownership in the Legal Entity; and,

  • ONE individual that has a Significant Managerial Control of the Legal Entity

NOTE:  It is possible that the control person may also be a Beneficial Owner.

If you are opening an account on behalf of a Legal Entity, modifying signer on an existing account, renewing a Certificate of Deposit or adding a service to your account, you will be required to provide the appropriate documentation and to certify that this information is true and accurate to the best of your knowledge.

In order to make this process as efficient as possible, we suggest that you obtain the above, bulleted information, along with a copy of the current Driver's License, State ID or other identifying document for EACH identified individual that is not present.  Please keep this information current and available to present EACH time you come in to establish a new account or make changes to an existing account.

If you have questions about Beneficial Ownership requirements for Legal Entities, please contact your branch, relationship manager, or Call Client Services during business hours at (951) 766-4100.

Beneficial Ownership | FAQ

What types of Legal Entities are covered by this regulation?

  • Corporations

  • Limited Liability Companies

  • General Partnerships

  • Limited Partnerships

  • Limited Liability Partnerships

  • Entities that are created by filing a public document with a Secretary of State or similar office; and, any similar business entity formed in the United States 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 has to complete the Certification of Beneficial Owner(s) form?

The person authorized to open an account on behalf of the Legal Entity.

What information does the Certification form require?

The person authorized to open an account on behalf of the Legal Entity.

  • Name

  • Physical residential address

  • Date of Birth

  • Social Security Number (or passport number or other similar information, in case of foreign person) for the following individuals

  • EACH individual, if any, who owns, directly or indirectly, 25% or more of the equity interests of the Legal Entity (e.g. each natural person who owns 25% or more of the shares of the corporation); and,

  • ONE individual with significant responsibility for managing the Legal Entity (e.g. CEO, CFO, COO, Managing Member, General Partner, President, VP or Treasurer)

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

When must the Certification be completed?

Prior to opening a new lending, deposit or safe deposit account for both new and existing Legal Entity customers.  

Must HCN Bank verify the accuracy of the information collected on each individual?

YES, HCN Bank is required to verify name, address, date of birth and Social Security Number for all beneficial owners. We verify that information by obtaining ID, unless the individual is an existing customer and HCN Bank already has ID on file.

Must Legal Entities notify HCN Bank of changes in beneficial ownership?

YES, if there are changes to the beneficial ownership structure we must obtain a new Beneficial Ownership Certification.  There may also be times when the Bank learns of beneficial ownership changes from sources other than the customer and will need the entity to complete a new Certification. 

Where will Beneficial Ownership information be stored?

The Bank will maintain the Certification and the information in its system of record.  This information is protected in the same manner as all other personal and account information, in accordance with our Privacy Policy. 

What if no one owns 25% or more of the Legal Entity?

If there are no owners with 25% or more ownership, either because all of the owners own a smaller percentage or because it is a nonprofit organization that has no owners, then only the information for the person who controls or manages the Legal Entity will be entered on the Control Section of the Certification. 

Who can assist customers with questions?

Customers should contact their respective branch, relationship manager or contact Customer Service at (951)766-4100.

Examples:

Here are some examples of how the Certification should be completed in certain circumstances: 

  • If there are four owners, each owning 25% then information on all four owners should be entered in the Beneficial Owner section of the Certification, AND information on one person in control of the entity should be entered in the Control section.

  • If there are two owners of 40% and one owner of the remaining 20%, then information on the two 40% owners should be entered in the Beneficial Owner section of the Certification, nothing needs to be entered for the 20% owner, AND information on one person in control of the entity should be entered in the Control section.

  • If there are five owners of 20% each, then no information needs to be listed on any of the owners in the Beneficial Owner section of the Certification, the box titled "Beneficial Owner Not Applicable" should be checked; AND, information on one person in control of the entity should be entered in the Control section.

  •  If the organization is a nonprofit entity, and doesn't have any owners, no information will be entered in the Ownership section of the Certification, the box titled "Beneficial Owner Not Applicable" should be checked; AND, information on one person in control of the entity should be entered in the Control section.