In BSA compliance, what is meant by "Beneficial Owner"?

In the context of BSA compliance, the term "Beneficial Owner" refers to individuals who own or control a legal entity or account, even if they are not the ones who have their names directly listed as account holders. This concept is crucial because it helps in identifying the real individuals behind corporate or other types of accounts, which is essential for preventing money laundering and ensuring compliance with regulations.

Identifying the beneficial owners involves understanding the ownership structure and any control mechanisms in place. This information is vital for financial institutions as part of their Know Your Customer (KYC) requirements, allowing them to assess the risk associated with accounts and engage in due diligence.

Other options do not align with this definition. The chief compliance officer, while important for regulatory adherence, does not represent ownership of accounts. Similarly, a government regulatory agency representative has a different role focused on oversight rather than ownership. The person who opens the account may not necessarily be the beneficial owner if that person is acting on behalf of someone else or a larger entity.