The US treasury department’s Financial Crimes Enforcement Network (FinCEN) is seeking comments on a notice of proposed rulemaking (NPRM) published on 15 December 2022 that would implement provisions of the Corporate Transparency Act (CTA) that govern the access to and protection of beneficial ownership information.
This NPRM proposes regulations that would govern the circumstances under which such information may be disclosed to financial institutions; federal agencies; state, local, tribal, and foreign governments, and how it must be protected.
Public access to beneficial ownership information is not being contemplated by the US authorities.
Due diligence and law enforcement
The proposed regulations describe how certain financial institutions and their regulators would access such information in order to fulfil customer due diligence requirements and conduct supervision.
They also specify how government officials would access beneficial ownership information in order to support law enforcement, national security, and intelligence activities.
Protecting sensitive information
The proposed rule also sets out standards for protecting what the US authorities consider to be sensitive information consistent with the goals and requirements of the CTA.
It also proposes amendments to the final reporting rule to specify when reporting companies may report FinCEN identifiers associated with entities. Reporting entities may in certain instances report a FinCEN identifier instead of the actual information associated with a particular beneficial owner.
Context and comments
This NPRM follows the final reporting rule that FinCEN issued on 30 September 2022, requiring most corporations, limited liability companies, and other similar entities created in or registered to do business in the US to report information about their beneficial owners to FinCEN.
All interested parties are encouraged by FinCEN to submit comments on its proposals. Written comments on this proposed rule may be submitted on or before 14 February 2023.
More details on and a link to FinCEN’s Notice of Proposed Rulemaking Regarding Access to Beneficial Ownership Information and Related Safeguards, can be found here.
Categories: Trade Based Financial crimes News