What does the term Beneficial Owner refer to?

• A. The registered name on a security account
• B. The real owner of an account or asset
• C. The individual who executes trades for an account
• D. The manager of an investment fund

Answer: (B)

The term Beneficial Owner specifically refers to the individual or entity that enjoys the benefits of ownership of an asset or security, even though the title to the asset may be in another name. This means that while the registered name on a security account might reflect an organization or another entity, the beneficial owner is the person who has the ultimate rights to the profits or control associated with that asset. This distinction is important in financial regulation and taxation, as it ensures that the true owner of the asset is identified for legal and regulatory purposes.

The other options describe different roles or aspects related to securities and accounts but do not capture the essence of what a beneficial owner is. The registered name on a security account identifies ownership for formal purposes, but it may not indicate the actual person receiving the benefits. The individual executing trades may act on behalf of the beneficial owner but doesn’t necessarily have ownership rights themselves. Similarly, a manager of an investment fund may oversee assets from a managerial perspective but is not the beneficial owner of those assets, as beneficiaries could include multiple stakeholders or investors in the fund.