Which Trust parties should be identified to determine the true nature of the Trust relationship according to Basel guidelines? (Choose three.)

Question

Options

• ARespondents
• BPayees
• CTrust Administrators
• DTrustees
• EBeneficiaries
• FSettlors/grantors

• A
  9% (2)
• B
  86% (19)
• C
  5% (1)

Explanation

According to the Basel guidelines on customer due diligence for banks, a trust is a legal arrangement whereby a person (the settlor or grantor) transfers the legal ownership of specific assets to another person or entity (the trustee) to hold for the benefit of a third person or persons (the beneficiaries). The Basel guidelines recommend that banks should identify and verify the identity of the following parties to determine the true nature of the trust relationship: The trustee, who is the person or entity that has the legal authority and duty to manage the trust assets and distribute them to the beneficiaries according to the trust deed. The trustee may also be the settlor, the beneficiary, or both, depending on the type and structure of the trust. The beneficiaries, who are the persons or entities that have a beneficial interest in the trust assets or income, either presently or in the future. The beneficiaries may be named individuals, classes of persons, or charitable causes. The settlor or grantor, who is the person or entity that creates the trust and transfers the legal ownership of the assets to the trustee. The settlor or grantor may also retain some rights or powers over the trust, such as the ability to appoint or remove trustees, beneficiaries, or

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