Exceptive Relief – In FinCEN’s exceptive relief related to rollovers, renewals, modifications and extensions, how do they describe certificates of deposit?

Compliance > BSA > FinCEN CDD/BO Rule - eff 2016
Q:  In FinCEN’s exceptive relief related to rollovers, renewals, modifications and extensions, how do they describe certificates of deposit?   
 
A:  In September, 2018, FinCEN issued a ruling that addressed exceptive relief from beneficial ownership requirements in specific situations.  In part, the ruling included covered product descriptions and characteristics.  For example, the following was included related to certificates of deposit: 
 
"Certificates of Deposit
 
For purposes of this Ruling, a certificate of deposit (CD) is a deposit account that has a specified maturity date, but cannot be withdrawn before that date without incurring a penalty.5  During the term of the CD, a customer cannot add additional funds to the CD. The term of a CD may vary from a week to several years. At the end of the term, when the CD matures, the customer is entitled to the amount deposited and any interest that has accrued; the customer may also have the ability to elect to either renew or close the account. Typically, the account will automatically renew absent affirmative action by the customer to close the account.
 
5. The definition of “CD” for the purposes of this Ruling differs from the definition of “time deposit” in Regulation D of the Board of Governors of the Federal Reserve System (Reserve Requirements of Depository Institutions, 12 CFR Part 204); see 12 CFR 204.2(c)(i)."
 
 
This Q&A was based on FinCEN’s ruling issued on September 7, 2018, as communicated in FIN-2018-R003, which may be found here:  https://www.fincen.gov/sites/default/files/administrative_ruling/2018-09-07/Permanent%20Exceptive%20Relief%20Extension%20of%20Compliance%20Date%20CDs_final%20508.pdf
 

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