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Concentration Account
(redirected from Concentration Accounts)

    Also found in: Wikipedia 0.03 sec.
Concentration account
A single centralized account into which funds collected at regional locations (lockboxes) are transferred.
Concentration Account
A large account kept by a bank or other financial institution for its own internal purposes. Financial institutions use the funds in their concentration accounts to settle numerous transactions that occur on a particular day. For example, if a customer closes his/her bank account, the money given to him/her likely comes from the concentration account. Often, the money in a concentration account comes from regional branches of a bank, which transfer funds to a central location. This is the origin of the name.

It was formerly relatively common for customers to transfer their own money through the concentration account of their banks, for both legitimate and illegitimate purposes. However, the USA PATRIOT Act forbade this practice.
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These features include, among others, debt service coverage triggers, an offshore collection and debt service payment mechanism, provisions for an early amortization of debt service if certain adverse events occur, and signed agreements between Unibanco and several correspondent banks obligating these banks to deposit relevant collections directly into the transaction concentration accounts without set-off.
S&P Rates UBB Diversified Payment Rights Finance Series 2002-1 by PR Newswire
Concentration accounts permit funds from various individuals to be commingled without divulging their origins.
Problems with Current U.S. Policy by Ehlers, Scott / Foreign Policy in Focus
The use of omnibus or concentration accounts by private banking customers that seek confidentiality for their transactions poses an increased vulnerability to banking organizations that the transactions could be the movement of illicit proceeds.
Statement to the Congress by Federal Reserve Bulletin
 
 
 
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