The financial crimes enforcement network is part of the department of treasury, and they have been tasked with collecting information on the ownership of small businesses with fewer than 20 employees. This is something that the 2021 congress enacted as a reaction to learning that small businesses can be fronts for money laundering and other nefarious activities.
As we know, the department of Treasury and IRS are some of the best law enforcement agencies the federal government has in its quiver. We’ve all heard the stories of how it’s these agencies that actually take down large crime including mafia, drugs and pyramid schemes. That’s the point of this new form. It’s a tiny step toward evaluating small business and seeing who the operators are and whether they are simply a front for crime.
From the FAQ.
In 2021, Congress passed the Corporate Transparency Act on a bipartisan basis. This law creates a new beneficial ownership information reporting requirement as part of the U.S. government’s efforts to make it harder for bad actors to hide or benefit from their ill-gotten gains through shell companies or other opaque ownership structures.
Beneficial Ownership Information Reporting | FinCEN.gov
This requirement has some teeth too.
As specified in the Corporate Transparency Act, a person who willfully violates the BOI reporting requirements may be subject to civil penalties of up to $500 for each day that the violation continues. That person may also be subject to criminal penalties of up to two years imprisonment and a fine of up to $10,000. Potential violations include willfully failing to file a beneficial ownership information report, willfully filing false beneficial ownership information, or willfully failing to correct or update previously reported beneficial ownership information.
Beneficial Ownership Information Reporting | FinCEN.gov
The completion of this form became a requirement this year. You have until the end of the year, but you may as well get it done now. It’s doesn’t take long. Here’s where you fill it out.
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