FinCEN amends beneficial ownership reporting rule to allow use of identifiers

The Financial Crimes Enforcement Network today released a final rule that amends the final beneficial ownership reporting rule to permit reporting companies to use the FinCEN identifier of another company in certain limited circumstances. A FinCEN identifier is a unique number issued by the agency assigned to an individual or legal entity. Reporting companies may opt to request an identifier when reporting to FinCEN.

The amendment allows reporting companies to use the FinCEN identifier of another reporting company when three circumstances are present. First, the other reporting company must have opted to obtain an identifier and use it in reporting to FinCEN. Second, the beneficial ownership of the other company must arise through an ownership interest. Third, the two companies must share the same beneficial owners.

In a statement, FinCEN said the rule responds to concerns from commenters that allowing the use of identifiers would obscure the identities of beneficial owners, resulting in greater secrecy or incomplete or misleading disclosures. The rule goes into effect Jan. 1, 2024, to align with the effective date of the BOI reporting rule, which was issued in September.

In addition to reporting companies, individual beneficial owners and company applicants may also opt to apply for a FinCEN identifier. The reporting rule already permits reporting companies to use the FinCEN identifier of individual beneficial owners and individual company applicants who opt for it. ABA in October urged the agency to adopt a modified individual FinCEN identifier application form to make clear which type of address needs to be reported for the individuals who create or register new businesses with reporting requirements, and to harmonize it with the BOIR form.