FinCEN finalizes a rule requiring banks to identify beneficial owners

The Financial Crimes Enforcement Network finalized its Customer Due Diligence (CDD) Rule on May 11, 2016, adding a fourth pillar to anti-money-laundering compliance: mandatory identification of beneficial owners of legal entity customers. Banks were required to identify natural persons owning 25 percent or more of any company opening an account, plus one controlling manager — collecting name, date of birth, address, and a government ID number. The rule, with compliance required by May 11, 2018, tightened corporate transparency requirements but also signaled a broader regulatory philosophy: financial institutions as front-line surveillance infrastructure for law enforcement — a role that would later be extended to immigration enforcement under the 2026 Trump executive order.