The US Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) has published a draft rule which will implement the beneficial ownership information reporting provisions of the Corporate Transparency Act (CTA).
The Act requires beneficial ownership reporting by domestic and foreign corporations, limited liability companies and ‘similar entities’ created in, or registered to do business in, the US.
In implementing such provisions, the draft rule provides a series of clarifications:
Such a collection of information is unprecedented in the US, as few states currently require legal entities to disclose information about their beneficial owners or the persons forming them. The resulting database will be manged by FinCEN and will not be publically accessible, but FinCEN will be authorised to disclose it to several categories of recipients, including federal law enforcement.
The rule also addresses the anti-money laundering risks posed by anonymous shell companies as set out in the US government’s new strategy on countering corruption.