I run a small 3-person LLC (cafe) and we've been with a Boston-based bank for almost 4 years. Out of nowhere they sent a letter asking for a 'complete list of company members' with names, addresses, and ownership percentages. No context, just a deadline. Is this normal? Did something change? I'm worried it's a scam or they're trying to close accounts.
Business Banking
Why did my Boston bank ask for a list of company members?
Welcome to the KYC annual review. Banks have to know who actually owns/controls the account. A 3-person LLC is exactly the kind of thing that trips flags when ownership isn't documented.
Sounds like the corporate transparencg stuff. Basically if a bank asks, you give it. Annoying but not unusual.
Make sure the letter is actually from the bank. Call the number on your debit ccard or your normal branch contact, NOT the number on the letter. If it's real, they'll tell you where to upload it.
I got the same thing in 2022 from my bank in Cambridge. Turned out I just needed to provide the articles of organization and a quick ownership table. Took 10 minutes. But yes, verify first.
Could be the Corporate Transparency Act (federal). But that's for the feds, not the bank directly. Still, banks are updating records left and right. They probably just need to see who is >25% owner.
If they're asking for addresses and percentages, that's beneficial ownership info. They're required to collect it. Just don't send it via plain email. Use their secure portal or bring it to a branch.
Also worth checking your operating agreement if you have one. If the ownership split isn't in writing anywhere, this is a good time to fix that.
A cafe with three owners. Let me guess: one does the books, one does the baking, and one is 'the ideas guy' who owns 33.3% and does nothing. Banks love that guy.
Honestly this is why I keep my business account at a credit union. They still ask but at least the person on the phone sounds like they've been to a cafe before.
That's not really a credit union vs bank thing, both follow the same regs. But I get it.
The deadline is probably just a checkbox. As long as you respond or ask for an extension, they won't freeze the account. Most banks only take action if you ignore them completely.
also don't overthink the percentage format. Just list the three owners and whatever the LLC docs say. If it's equal, write 33.33% each. They're not grading your math homework.
Wait, so this is a regular thing now? I got one from my bank in Southie last month and assumed it was junk mail. I should probably open that.
Yes. Open it. Next question.