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Why the DNA of beneficial owners prevent companies from self-submitting beneficial ownership information
Journal of Financial Compliance,
1
(2),
123-136
(2017)
Abstract
The paper is a detailed analysis of beneficial ownership information and how best to obtain the information. The paper will provide readers with insights into a range of areas such as: ●● the data-DNA of beneficial owners; ●● the ‘three inherent flaws’ of asking companies to self-submit beneficial owner information; ●● how current political solutions to provide ownership transparency are built on an eroded data foundation leading to a false sense of security; ●● five key factors to obtaining correct beneficial owner information and ●● how anti-money laundering (AML) policies focusing on primary sourced beneficial ownership information leads to less rather than more AMLcompliance at financial institutions. The paper starts by taking a thorough look at beneficial owners from a data perspective by outlining the key beneficial ownership challenges and establishing why beneficial ownership is a radically different data point from others in the know your customer process. The next part considers some of the recent proposed political solutions to these challenges such as, for example, beneficial owner registries and problematises certain aspects of these solutions. The final section focuses on actual solutions to obtain beneficial ownership information, both in the perfect world and within the current political context.
Keywords: beneficial owner, beneficial owner registries, anti-money laundering (AML), sanctions, compliance, FinCEN customer due diligence (CDD) rule
The full article is available to subscribers to the journal.
Author's Biography
Anders A. L. Rodenberg MSc, is the Head of Financial Institutions and Advisory in North America for Bureau van Dijk. Originally from Scandinavia, Anders previously served as Head of Compliance for the Nordic European Region at Bureau van Dijk before transferring to the USA, giving him key compliance insight and experience on both sides of the Atlantic. Anders has been involved in multiple compliance projects in areas ranging from anti-money laundering (AML) and Office of Foreign Assets Control (OFAC) sanctions to Foreign Account Tax Compliance Act (FATCA) and Foreign Corrupt Practices Act (FCPA), helping to improve compliance levels at various financial institutions, insurance companies and traditional corporates. Much of his work has been focused on improving on-boarding procedures, enhanced due diligence (EDD) processes, off-cycle notification systems, sanctions 50%-rule identification, investigation and monitoring through global standardisation and introducing global ownership structures into the AML and OFAC risk models. Anders has met with regulatory authorities and industry leaders in numerous countries, giving him key industry knowledge with a special focus on trends and developments. He also often speaks at compliance conferences. Anders graduated from Aarhus University in Denmark and studied at London School of Economics and Copenhagen Business School.
