Beneficial Owner
AdvancedA beneficial owner is the person who ultimately owns or controls a company, trust or other legal entity, or on whose behalf a transaction is carried out, even if the assets are held in someone else's name.
Companies, trusts and other entities can be used to hide who really owns assets or benefits from them. Criminals may use chains of companies across several countries to conceal the proceeds of crime or avoid sanctions. Identifying beneficial owners helps prevent this.
Anti-money laundering rules require banks and other regulated businesses to identify the beneficial owners of their corporate customers. A common threshold is ownership or control of more than 25% of a company, although some regimes use lower thresholds for higher-risk situations.
For example, if a company is owned by another company, which is in turn owned by a trust, the bank must look through these layers to identify the individuals who ultimately own or control it.
Many countries have created registers of beneficial ownership, so authorities and sometimes the public can see who owns companies. Access and requirements vary, and some registers have faced legal challenges or changes.
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