But the trade association reported that the new requirements do not mean credit unions have to update member information on a continuous or periodic basis.
“The rule does not require credit unions to update member information on a continuous or periodic basis. The updating requirement is event-driven and only occurs as a result of detecting unusual activity through normal monitoring,” CUNA stated.
The new procedures required by May 11, 2018, are:
- Procedures to identify and verify beneficial owners of legal entity members.
- Procedures for making and maintaining a record of all the identification and verification information collected for beneficial owners of legal entity members.
- Appropriate risk-based procedures for conducting ongoing member due diligence.
- Updated recordkeeping procedures to record, any identification information obtained, a description of any document relied upon, any non-documentary methods used; and any measures taken in response to any substantive discrepancies, as well as the results of those actions.
- “Beneficial owner:” Ownership criteria (25% or more equity interest) and/or control criteria (has significant responsibility to control the legal entity).
- “Legal entity:” Accounts owned by legal entities, rather than natural-person accounts.