The American Bankers Association today suggested the Financial Crimes Enforcement Network make several revisions to its beneficial ownership information rule to ease the burden of its reporting requirements, including exempting banks from the definition of “beneficial owner.”
FinCEN in March issued an interim final rule to end the requirement for U.S. companies and persons to report BOI to the agency under the Corporate Transparency Act. The Treasury Department, of which FinCEN is part, is also considering other revisions to narrow the scope of the reporting requirements. In a letter, ABA outlined several steps the agency could take to achieve that goal. One would be to exempt banks and the trusts they administer from the definition of “beneficial owner” and “company applicant,” as both already are exempt from the definition of “reporting company.”
“Banks, and their trust operations, are regulated, regularly examined, and already fully transparent,” ABA said.
ABA also suggested that the agency provide the same regulatory relief to the individuals who received FinCEN Identifiers that it already extends to U.S. small businesses. The letter further noted that banks alone should not be required to identify the BOI of foreign-owned or foreign-controlled shell companies even if they happen to be created by filing with a U.S. state secretary of state’s office or tribal equivalent; nor should banks have to bear the sole burden of identifying all the beneficial owners of the 12,000 foreign companies registered to do business in the U.S. that pose a heightened risk to national security; and that FinCEN should revise the 2016 customer due diligence rule to reduce the burden on banks by allowing them to collect information on the customer level, not every time an existing customer opens a new account, which happens over 140 million times annually.
