FinCEN CDD BO FAQ 2 - 29 – Does the point of sale exception only apply to accounts opened at the cash register or does it refer to all applications for credit accounts that are for use at the private label retailer only?

Compliance > BSA > FinCEN CDD/BO Rule - eff 2016
Q:  Does the point of sale exception only apply to accounts opened at the cash register or does it refer to all applications for credit accounts that are for use at the private label retailer only?
 
A:  The Rule provides an exemption from the requirements for a covered financial institution that “opens an account for a legal entity customer that is:  [a]t the point-of-sale to provide credit products, including commercial private label credit cards, solely for the purchase of retail goods and/or services at these retailers, up to a limit of $50,000.”  The point of sale exemption is provided for retail credit accounts opened to facilitate purchases made at the retailer because of the very low risk posed by opening such accounts at the brick and mortar store.
 
 
ADDITIONAL INFORMATION:
The above FAQ was included in FinCEN’s 2nd set of CDD FAQs that were released in April 2018.  The FAQs are provided to assist financial institution in understanding the scope of the customer due diligence / beneficial ownership rule.  The 2018 FAQs may be found here:
 

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