FinCEN to small businesses: Don’t wait to file beneficial owner reports

The Financial Crimes Enforcement Network called on small businesses to begin filing initial beneficial ownership reports under the Corporate Transparency Act.

Details: At the latest beneficial ownership information reporting event, in Philadelphia, FinCEN Director Andrea Gacki noted that while small businesses created or registered before this year must file by Jan. 1, 2025, they don’t have to wait. Further, those created or registered this year have 90 days to file an initial report, and that period drops to 30 days next year.

Willful Violations: Gacki reiterated that small-business owners doing their best to comply with the law should not lose sleep over these new reporting requirements. She noted the CTA penalizes willful violations of the law and that this is where FinCEN plans to focus its enforcement actions.

Background: Under the CTA—a bipartisan law enacted to curb illicit finance by supporting law enforcement efforts—many small businesses are now required to report basic information to the federal government about the real people who ultimately own or control them. FinCEN FAQs include information on reporting companies and exemptions.

ICBA View: ICBA has repeatedly called on FinCEN to withdraw beneficial ownership requirements for banks now that it is required to collect this information directly from reporting companies. ICBA this year said FinCEN’s estimated burden of complying with its final rule on accessing beneficial ownership information does not accurately reflect the demands of collecting this information.