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UBO - Ultimate Beneficial Ownership

UBO - Ultimate Beneficial Ownership

Fenergo Client & Counterparty Data Management provides a true representation of client relationships, complex hierarchies and ultimate beneficial ownership across a wide range of regulations (AML, KYC, CRS, FATCA).

Fenergo Client & Counterparty Data Management enables financial institutions to enhance their risk and regulatory management by gaining a full and true understanding of every legal entity with which it engages in business.

Under AML / CTF laws, financial institutions are tasked with identifying the real ownership of all assets. “Identifying the beneficial owner, and taking reasonable measures to verify the identity of the beneficial owner, such that the financial institution is satisfied that it knows who the beneficial owner is. For legal persons and arrangements this should include financial institutions understanding the ownership and control structure of the customer.” FATF (Financial Action Task Force)

The identification of beneficial owners and, in particular, the ultimate beneficial owner (UBO), forms an integral part of the overall Fenergo’s Regulatory Solutions – from Fenergo Anti-Money Laundering (including the 4th EU Money Laundering Directive) and Know Your Customer (KYC) solutions to Fenergo’s Tax Compliance suite (including Fenergo Common Reporting Standard (CRS) and Fenergo Foreign Account Tax Compliance Act (FATCA)).  

Tax compliance regulations, in particular, such as FATCA, introduces a requirement for a 10% or more threshold for beneficial ownership (if the person displays U.S. indicia), which is significantly higher than the 25% norm, which most AML/KYC reviews currently demand (for low risk entities). This means that FATCA requires a level of Customer Due Diligence (CDD) that goes beyond that with which AML compliance professionals are currently familiar.

Fenergo Client & Counterparty Data Management enables financial institutions to assess and gain a full appreciation of the overall corporate structure and ownership model that underpins each entity, as well as a full view of all interlinked companies, directors, shareholders, guarantors and beneficiaries. Fenergo’s solution enables financial institutions to proactively track and manage all of this information efficiently and effectively.

The solution integrates seamlessly with Fenergo’s Regulatory Onboarding and Client Lifecycle Management solutions, enabling the financial institution to conduct CDD / KYC on the entity itself, its directors, shareholders and beneficial owners in one integrated process, making the identification of beneficial owners, and particularly the ultimate beneficial owner, even easier.

Useful resources

Beneficial Ownership in Focus, FinCEN vs EU Money Laundering Directive

A deep-dive into the beneficial ownership requirements of FinCEN’s Final Rule and 5th EU Money Laundering Directive.

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Client & Counterparty Data Management

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Fourth European Anti-Money Laundering Directive

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