US treasury to suspend beneficial ownership reporting

Yesterday the US treasury announced it will suspend reporting for beneficial ownership information for millions of domestic businesses.

This law was created to help deter illicit finance through shell companies or other opaque ownership structures. It was also designed to align the U.S. globally with financial transparency, especially around beneficial ownership of entities to help prevent terrorist organizations, organized criminals, and other bad actors from exploiting the U.S. financial system and hide their illicitly obtained financial gains.

While arguments against burdening small businesses with the requirements of beneficial-ownership compliance and of financial reporting are understandable, greater transparency could help raise financial institutions’ awareness of bad actors in their customer base and support them in avoiding onboarding bad actors who might have otherwise been hidden or overlooked.

Blog: https://www.moodys.com/web/fr/fr/kyc/resources/insights/cta-uncertainty-and-the-effect-on-boi-and-law-enforcement.html

Shell Company Data Story: https://www.moodys.com/web/en/us/about/insights/data-stories/kyc-innovation-shell-company-indicator.html