Mammoth Enterprises is a new customer to the bank. It is a wholly owned subsidiary of Mammoth Corporation. Which of the following statements, if true, would make Mammoth Enterprises an exempt customer at the bank?
Mammoth Enterprises is a new customer to the bank. It is a wholly owned subsidiary of Mammoth Corporation. Which of the following statements, if true, would make Mammoth Enterprises an exempt customer at the bank?
Mammoth Corporation is a U.S. corporation trading on the American Stock Exchange. Under the Bank Secrecy Act (BSA) regulations, a wholly owned subsidiary of a parent corporation that is a U.S. corporation trading on a recognized stock exchange, such as the American Stock Exchange, can qualify as an exempt customer. This exemption is based on the parent corporation's status, which ensures that its financial activities are subject to regulatory oversight and public scrutiny, thereby reducing the risk of money laundering or other illicit activities.
The correct answer is C. Mammoth Corporation is a U.S. corporation trading on the American Stock Exchange. Under the Bank Secrecy Act (BSA) regulations, a wholly owned subsidiary of a parent corporation that is a U.S. corporation trading on a recognized stock exchange (such as the American Stock Exchange) can qualify as an exempt customer. This exemption is based on the parent corporation's status, which implies that its financial activities are subject to regulatory oversight and public scrutiny, reducing the risk of money laundering or other illicit activities that the BSA aims to prevent.