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Introducing Broker-Dealers Must Meet Customer Identification Obligations, FinCEN Says
printBroker-dealers that serve as introducing agents for securities transactions are responsible for maintaining customer identification programs, the U.S. Treasury Department's Financial Crimes Enforcement Network said Tuesday. Agreements with broker-dealers usually specify that the firm introducing a customer into an arrangement is responsible for opening and approving accounts and receiving and accepting orders, while the clearing firm is responsible for extending credit, holding customer funds and securities and issuing confirmations. Under such arrangements, the introducing firm, not the clearing firm, is responsible for complying with customer identification program requirements, said FinCEN. "Accordingly, FinCEN will take no action against a clearing firm...
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