FinCEN Regulations: BSA’s Revised Beneficial Ownership Requirements
The Financial Crimes Enforcement Network (“FinCEN”) issued final regulations in 2022 to implement the revised “beneficial ownership information” disclosure rules for legal entities (the “Final Rule”) under the Corporate Transparency Act (“CTA”), which is part of the comprehensive revisions to U.S. anti-money laundering statutes included in the Defense Appropriations Act of 2021.
Specifically, the Final Rule implements Section 6403 of the CTA and requires reporting companies, including a range of U.S. legal entities and non-U.S. legal entities registered to do business in the U.S., to submit to FinCEN specified information identifying their beneficial owners—that is, the natural persons who own and control them—as well as information about the persons who form or register those legal entities.
The effective date of the Final Rule is January 1, 2024.
The Final Rule will have implications for M&A, financings, private equity, restructurings, and other deals that involve establishing or acquiring legal entities in the U.S.