05/11/22

Last year the OBL scored a significant public policy victory with the passage of the Corporate Transparency Act (CTA). The legislation directed the Financial Crimes Enforcement Network (FinCEN) to establish a national beneficial ownership registry and allow banks access to it. Once created the registry would significantly improve banks compliance process for complying with beneficial ownership rules. FinCEN has released a series of public comments in order to implement the CTA. This week Sen. Chuck Grassley (R-Iowa), member of the Senate Finance Committee, joined Sens. Elizabeth Warren (D-Mass.), Sheldon Whitehouse (D-R.I.), Marco Rubio (R-Fla.), Ron Wyden (D-Ore.), Bob Menendez (D-N.J.) and Bill Cassidy (R-La.) to send a letter to Treasury Secretary Janet Yellen and Acting Director of the Financial Crimes Enforcement Network (FinCEN) Himamauli Das, calling on the Treasury Department (Treasury) to swiftly implement the CTA and provide a timeline for doing so.

 In the letter the lawmakers stated, “the Treasury Department has yet to finalize the implementation of the CTA—or even set a timetable for its completion… In various hearings last month, both of you could only commit to proposing the second CTA rule by the end of ‘this year.’ These delays run contrary to the clear instructions of Congress, undermine American efforts to respond to Russia’s war against Ukraine, and hinder broader efforts to protect the U.S. financial system against the threat of illicit finance.” 

Passed by Congress last year, the CTA is landmark legislation that would upgrade the country’s anti-money laundering laws and address one of the biggest weaknesses in the United States’ anti-money laundering safeguards: anonymous shell companies that hide the true, beneficial owners of assets. Beneficial ownership disclosure, as required by the CTA, is particularly relevant amidst Russia’s invasion of Ukraine since such information is necessary to implement the United States’ historic sanctions against Russian oligarchs and to protect national security and the stability of the U.S. financial system.