Financial Crimes Enforcement Network Priorities – FinCEN

The U.S. Treasury’s Financial Crimes Enforcement Network has determined its priorities for monitoring and enforcing the law against entities and individuals that fail to comply with their Beneficial Ownership Report (BOI) reporting responsibility.

FinCEN’s final rule on BOI reporting went into effect on January 1, 2024. FinCEN issued a template for beneficial ownership reporting, and is revising it in response to criticism from Congress and some industry sectors. The CTA requires newly formed reporting companies (as of 2024) to submit their beneficial ownership and company applicant information to FinCEN within 90 days of their formation. For reporting companies formed before January 1, 2024, the deadline to submit beneficial ownership information is December 31, 2024.

FinCen stated among its priorities to comply, the following points:

  • Review standards for collecting federal claims (31 CFR Parts 900-904).
  • Propose a regulation for the Establishment of National Examination and Supervision Priorities.
  • Propose a regulation for Reports and Records of Real Estate Transactions.
  • Propose revisions to customer due diligence requirements for financial institutions.
  • Issue a final rule for a pilot program on information sharing related to suspicious activity reports within a financial group.
  • Issue a final rule on access to and safeguards for beneficial ownership information and the use of FinCEN identifiers for entities.
  • Initiate a long-term study of Modifications to the Definition of Securities Broker or Distributor (Crowdfunding).
  • Initiate a long-term study on clarifying the requirement to collect, retain and transmit information on transactions involving convertible virtual currencies and digital assets with legal tender status.
  • Initiate a long-term study into the requirements for certain transactions involving convertible virtual currency or digital assets.
  • Begin a long-term study of Section 6110 of the Bank Secrecy Act involving antiques and arts dealers.
  • Initiate a long-term study of commercial real estate transaction reports and records.

The BOI Data that FinCEN collects from CTA reporting companies will be retained in a “Beneficial Ownership Secure System” or “BOSS” database. FinCEN issued a Notice of Proposed Rulemaking with respect to how various parties would access the BOSS (the “Access Rule“). Both industry advocates and Congressional sources criticized the Access Rule and FinCEN acknowledged that criticism, promising to change its approach. FinCEN has not yet issued a new NPRM with respect to the Access Rule.

A key aspect of the CTA was that the BOSS was supposed to be “highly useful” to banks and financial institutions, who are currently required to collect beneficial ownership information from their customers under a separate set of regulations under the Bank Secrecy Act. 31 CFR 230. FinCEN issued regulations to harmonize the CTA’s beneficial ownership information requirements with banks’ beneficial ownership data collection obligations under its Customer Due Diligence Rule. FinCEN’s latest announcement confirmed that the Reporting Rule has already gone into effect on January 1, 2024.

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