Balance visibility

why balance visibility matters cross river holds customer funds in fbo (for benefit of) accounts federal banking regulations require records that show who owns each portion of those funds this visibility gives each customer their own $250,000 in fdic pass through insurance without it, the entire pooled account shares a single $250,000 limit how you achieve balance visibility depends on your program's balance model fbo subledger docid\ z5zkbyq txaz 1bvhxbyg subledgers in cos fbo pooled account docid\ z5zkbyq txaz 1bvhxbyg daily balance files fdic pass through insurance eligibility requires balance visibility fdic pass through insurance pass through insurance gives customers in pooled accounts individual fdic coverage each customer receives up to $250,000 in coverage the insurance passes through the custodian (you) to the end customers you must meet three regulatory requirements 1\ disclosure account records must show that you hold funds in a fiduciary or custodial capacity how you satisfy this use an fbo account title like "partner, inc fbo customers" maintain clear designation in cross river's account records structure the account to demonstrate the custodial relationship 2\ identity ascertainment cross river must identify the beneficial owners and their balances this information must come from account records you must maintain these records in good faith as part of regular business operations how you satisfy this in the fbo account model map each customer id to a balance in a daily balance file you or your processor maintain the file cross river receives the file daily via sftp docid\ i4b iqavcqfp9m1611twc how you satisfy this in the subledger model each customer has a subledger in cos each subledger links directly to a customer id cross river has real time visibility into balances within its systems 3\ beneficial ownership customers must actually own the funds they cannot be creditors with claims against you, the partner you must hold funds in trust for customers, separate from corporate funds how you satisfy this execute legal fbo agreements with cross river segregate customer funds from your operating accounts restrict use of customer funds for corporate purposes ensure customers have direct beneficial ownership rights what does not qualify depositing customer funds into a general corporate account creates a creditor relationship if you record "owes customer $x" in an internal database, that is not beneficial ownership this structure does not qualify for pass through insurance balance visibility by model model visibility method fdic compliance mechanism card only bin sponsorship docid\ z5zkbyq txaz 1bvhxbyg n/a no funds at cross river, no insurance required fbo subledger docid\ z5zkbyq txaz 1bvhxbyg subledgers in cos internal records provide identity ascertainment fbo pooled account docid\ z5zkbyq txaz 1bvhxbyg daily balance file file provides confirm identity both the fbo pooled account and fbo subledger models satisfy the three fdic requirements differently the fbo subledger model gives you real time visibility the fbo pooled account model relies on daily file submission