The Corporate Transparency Act became a law on January 1, 2021. The CTA provided that it would become effective January 1, 2022. This law requires almost all existing companies formed in the United States since the U.S. became a country to file a report with the Financial Crimes Enforcement Network (FinCEN) that discloses information about each of the company’s “beneficial” owners. A beneficial owner is a person, entity or trust that own 25% or more of the company or who has substantial control of the company.
These FinCEN filings must disclose the following five items of information about each beneficial owner:
- birth date
- number from a driver’s license or passport
- picture of the driver’s license or passport.
That’s it. The organization that is supposed to protect all Americans, the U.S. government, has been unable for 21 months to create a system to collect five tiny items of information.
A recent article called “New US company owner database ‘taking way too long’ to implement, experts warn” says:
“Experts say the Treasury Department is badly behind schedule in implementing the law mandating the government to collect ownership data from companies operating in the United States. . . . There is a lot of anxiety that the Biden administration will take the whole four years to finalize the rules setting up the beneficial ownership registry . . . . FinCEN has only proposed one of the three sets of rules needed to launch the ownership database. And even this first set — governing how the data will be collected and who must report company ownership — hasn’t been finalized”