Beneficial ownership

Welcome to The Laundry, the podcast connecting AML, compliance and financial crime to the real world.

Oh, say can you see? When it comes to beneficial ownership data in the USA, the answer is no, you can't.

In August, 2026, FinCEN made it official.

US companies no longer have to disclose who actually owns them.

And the data already collected is being deleted.

I'm your host, Robin Laika, Solutions Architect here at Strize.

And in this episode, we're asking, is this the end of beneficial ownership data? We'll be discussing the government decision which will wipe 16 million reports, why the decision was taken, and the long-term consequences.

To dive into this topic, I'm delighted to be joined from the USA by Erika Hanecek, co-director of the FACT Coalition.

They had a lot of lawsuits and, you know, people kind of fighting against that.

And then by March of 25, they, FinCEN released a, an interim rule that paused the need to report beneficial ownership information for domestic companies.

So what this final rule that came out earlier in August did was it really locked in that interim rule.

So now this reporting rule that's part of the CTA only applies to foreign companies entities that are registered to do business in the US.

I think the threshold was 20 employees and 5 million in annual revenue were outside of that reporting requirement.

So it was really the small, closely held companies, the kind of vehicle that you would launder money through.

uh was was who needed to report that being the point of the of the reporting requirement uh so this did do away with that uh so yeah during that window between uh 2024 and 2025 uh you know an aircraft holding company should have been obligated uh to have submitted uh uh its uh beneficial ownership information defense and That certainly was the safer approach.

I know some people did not do that based on some early court rulings that said that it didn't apply.

The Corporate Transparency Act was designed to close that loophole.

Starting January 1st, 2024, most small businesses in the United States were required to file what's called a Beneficial Ownership Information Report, or BOI report, with a Financial Crimes Enforcement Network, which is part of the Treasury Department and goes by the acronym FinCEN.

The idea was simple on paper.

Tell the government who actually owns your company.

It was a mess.

And then the Treasury Department made a significant move.

The final rule from FinCEN, which was announced this year, removes the beneficial ownership information reporting requirement for two categories, domestic companies, meaning entities formed under the laws of a U.S. state or tribe, and U.S. persons, meaning citizens and lawful permanent residents.

That's a big carve-out.