Eric Cartwright
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KYC for Transparency
Know Your Customer and Customer Identification Program obligations apply squarely to U.S. domestic aircraft transactions. Verifying identities, beneficial owners, sanctions exposure and aircraft history is essential to avoid legal and reputational fallout.
KYC/CIP in U.S. Domestic Aircraft Transactions
Required Steps: Verify identities (per FinCEN CIP), identify beneficial owners (≥25%), check OFAC sanctions lists, and confirm FAA citizenship eligibility.
Recommended Steps: Apply Enhanced Due Diligence (EDD) for high-risk parties (e.g., politically exposed persons, complex LLCs), re-screen during the process, and verify funding sources for higher-risk deals.
Key Risks:
Criminal Funds: Risk of charges and forfeiture if illicit money is involved.
Sanctions Violations: Heavy penalties for dealing with OFAC-listed parties.
PEP Risks: Corruption/reputation issues, even domestically.
Aircraft History: Potential seizure if linked to crimes; unlawful if seller/UBO is sanctioned.
Mitigation: Use sanctions/PEP screening, bank record checks, FAA title search, and history review.
Bottom Line: Domestic deals are simpler than international ones, but strict, consistent KYC/CIP and aircraft history checks are essential to avoid legal and reputational fallout.
AvBuyer – Aircraft Brokers: How Well do you Know Your Customer?