FinCEN Eases Banks’ Obligation to Verify Customers’ Ownership

A Treasury Department unit pared back banks’ due diligence requirements for their customers, saying they will no longer have to verify an entity’s ownership each time the entity opens a new account.

Instead, banks and other covered financial institutions generally will have to identify and verify an entity’s beneficial owners only when the entity first opens an account with the institution, Treasury’s Financial Crimes Enforcement Network said in an order issued Friday.

The move “reduces unnecessary regulatory burden,” FinCEN said in a statement.

Verifying beneficial ownership also will be required when there’s reason to question the reliability of previously ...