Complying With FinCEN and Customer Due Diligence (CDD)

The Customer Due Diligence (CDD) Rule put into effect on May 11, 2018 by The Financial Crimes Enforcement Network (FinCEN) serves to protect financial institutions and the general public from financial criminals and terrorists, and it is pertinent that it be followed meticulously. For years, terrorists easily misused companies to disguise their crimes. Often, they would get away with utilizing fake identities and make illegal transactions, causing a domino effect that has impacted banks, companies, individuals, and the U.S. economy.

However, now, the CDD Rule acts as a protective barrier that allows financial institutions and the general public to have more reliable information about one another in order to sway terrorist and criminal activity. The CDD Rule requires financial institutions to identify and verify all individuals who profit from the company any time an individual opens an account.

There are four mandatory requirements to be aware of in order to comply with FinCEN’s CDD Rule:

  1. All customers must be identified and verified.
  2. All beneficial owners of companies must be identified and verified.
  3. Companies must utilize Know Your Customer (KYC) best practices in order to develop customer risk profiles.
  4. Companies must monitor customer activity, update customer information, and report any suspicious activity.

There is a no-hassle way to comply with this rule. At Liberty Data, Inc., where you can access complete EIN Business Reports, People Background Reports, Criminal Records, Assets, and more, you can also easily find the Legal Responsible Officers (LEROs) for a company with which you may be doing business. Simply click on our FinCEN CDD tool, created specifically with the CDD Rule in mind, enter the business name, and discover Responsible Officers, including PII details. Liberty Data, Inc.’s REALSearch.com is a veteran-owned, minority-owned leader in the field of providing high quality identity verification and risk management tools for banking professionals, investigators, collectors, and more. REALSearch.com offers access to its databases to industry professionals who must qualify to use the service. These databases provide consumer and business information to collectors, bankers, private investigators, corporate investigators, insurance industry investigators, skiptracers, federal, state and local law enforcement agencies, collection agencies, debt buyers, attorneys and paralegals, etc, to manage risks and locate assets, individuals and businesses.

It is imperative to follow the CDD Rule, and to identify and verify the identity of any individual who owns 25 percent or more of a company. Utilizing the tools at Liberty Data, Inc.’s REALSearch.com make applying, checking, and complying to this rule easier than ever.