Question:  If an entity is exempt from filing a FinCEN Report, is its wholly-owned subsidiary also exempt from filing a FinCEN Report?

Answer: A subsidiary of an entity that is exempt from filing a FinCEN Report is also exempt from filing a FinCEN Report if the subsidiary entity’s ownership interests are controlled or wholly owned, directly or indirectly, by any of these types of exempt entities:

  • Securities reporting issuer, as defined in Exemption #1;
  • Governmental authority, as defined in Exemption #21;
  • Bank, as defined in Exemption #3;
  • Credit union, as defined in Exemption #4;
  • Depository institution holding company, as defined in Exemption #5;
  • Broker or dealer in securities, as defined in Exemption #7;
  • Securities exchange or clearing agency, as defined in Exemption #8;
  • Other Exchange Act registered entity, as defined in Exemption #9;
  • Investment company or investment adviser, as defined in Exemption #10;
  • Venture capital fund adviser, as defined in Exemption #11;
  • Insurance company, as defined in Exemption #12;
  • State-licensed insurance producer, as defined in Exemption #13;
  • Commodity Exchange Act registered entity, as defined in Exemption #14;
  • Accounting firm, as defined in Exemption #15;
  • Public utility, as defined in Exemption #16;
  • Financial market utility, as defined in Exemption #17;
  • Tax-exempt entity, as defined in Exemption #19; or
  • Large operating company, as defined in Exemption #21.

Source: Small Business Compliance Guide pages 5 – 12 for specific tests for these exemptions.