What type of entities are only subject to the control criteria prong in the definition of "beneficial owner"?

The definition of "beneficial owner" within the context of the Bank Secrecy Act (BSA) identifies specific criteria that help determine the individuals or entities that ultimately own or control legal entities. The control criteria prong refers to individuals who exercise significant control over an entity, regardless of whether they have a direct ownership interest.

Non-profit corporations and pooled investment vehicles fit this description because these types of entities may not have traditional ownership structures like corporations or partnerships. Instead, their governance might be more collective, with a board of directors or similar entity exercising control without specific individuals having singular ownership stakes. Therefore, it is appropriate that these entities are subject only to the control criteria prong when defining their beneficial owners.

In contrast, individuals with bank accounts, corporations, and all legal entities may have clear ownership interests or other distinctive features that necessitate additional considerations beyond just control. This differentiation underscores the unique nature of non-profit corporations and pooled investment vehicles in relation to the BSA's requirements for identifying beneficial owners.