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FinCEN Issues Final Rule for Beneficial Ownership Reporting

On September 29, 2022, FinCEN issued a final rule for Beneficial Ownership Reporting to support law enforcement efforts. The rule establishes timeframes for legal entities to report beneficial ownership information FinCEN as required by the Corporate Transparency Act (CTA). According to the publication, FinCEN will have rulemakings to:

  • Establish rules for who may access the beneficial owner information, for what purposes and what safeguards will be required to ensure the information is secured and protected.
  • Revise FinCEN’s customer due diligence rule.

Currently, FinCEN is developing the information technology system to collect the information. The rule becomes effective for all existing legal entities and newly created legal entities after January 1, 2024.

What does this mean for financial institutions right now?

To put it simply, nothing – This rule does not change how financial institutions are collecting beneficial ownership information. It still requires financial institutions to obtain beneficial ownership certifications from their legal entity customers. FinCEN will publish subsequent notices of proposed rulemakings with comment periods as is develops the infrastructure for a national beneficial ownership database. As more information becomes available, TCA will notify you of any updates.

To read the bulletin, please go to FinCEN issues final Beneficial Ownership Rule.

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