What is a Financial Institution’s responsibility when it functions as an escrowagent?
The Financial Institution should treat the parties to an escrow agreement as customers for due diligence purposes. (It may be that one, or more of the parties is already an existing customer of the Financial Institution). The Financial Institution should understand the structure of a proposed escrow arrangement and its purpose, and should determine whether the purpose of the escrow transaction is consistent with its structure and whether the transaction makes economic sense. 1) The Wolfsberg Group consists of the following leading international financial institutions: ABN AMRO, Banco Santander, Bank of Tokyo-Mitsubishi-UFJ, Barclays, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, JP Morgan Chase, Société Générale, and UBS. These FAQs were prepared by the Wolfsberg Group in association with RBC Financial Group and SEB Group. 2) These FAQs generally use the term “due diligence” rather than “know your customer” (or “KYC”) because a Financial Institution may sometimes conduc
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