Must a credit union identify beneficial ownership for each account opened by a legal entity member?

The correct understanding of the requirement for a credit union to identify beneficial ownership for each account opened by a legal entity member lies in adherence to the regulations under the Bank Secrecy Act (BSA) and specific FinCEN (Financial Crimes Enforcement Network) requirements. The accurate approach is that credit unions must indeed identify beneficial ownership for each new account opened by a legal entity member, which aligns with standard compliance practices.

When it comes to previous information, the regulation does not permit reliance solely on data from previous accounts. It necessitates that credit unions perform the identification process as part of their due diligence for each new account opened, despite potential historical information being available. This includes collecting information regarding the beneficial owners associated with the legal entity to ensure robust anti-money laundering (AML) and counter-terrorism financing (CTF) measures are maintained.

The other choices miss the mark because they propose exceptions or conditions that are not consistent with the regulatory requirements. Every legal entity member must be evaluated in the context of a new account, reinforcing the principle of maintaining updated records for compliance with the BSA. By doing so, credit unions can better mitigate risks associated with potential illicit activities.