ProPay is required by law to verify the identity of an account owner – with the Patriot Act and KYC requirements. Our sponsor bank has outlined that anyone with 20% or greater ownership, or someone in the company who can sign and has the authority to make financial decisions can be accepted for this verification. And that the verification is done using the SSN, Name, Address, DOB etc. It is not a credit check, but an identity check.
Additionally in May of 2018 a new FinCEN requirement came into effect. The rule amends the Bank Secrecy Act and the Anti-Money Laundering program requirements, to include the obligation that financial institutions identify and verify the identity of beneficial owners (to ensure they are not on the OFAC list, OSFI list, etc.). All ProPay Partners must comply with the Beneficial Owner requirement.
To help identify the individuals that fall under the Beneficial Owner requirement:
o A beneficial owner is any person or entity that owns 25% or more of an entity, or any person or entity that practices significant control over the organization (i.e. Chief Operating officer or Managing Director.)
o Entities registered as LLC, who have only one member still fall under the Beneficial Owner rules.
o Sole Proprietors, Assumed Sole Proprietors, and other excluded entities (non-profits, government entities, some public companies, and financial institutions) are subject to some alternative requirements, including FinCEN’s Know Your Customer requirements.