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The Corporate Transparency Act (CTA) introduces a new requirement for most business entities (corporations, LLCs, partnerships, etc.) to submit names, contact information, and identification for their beneficial owners to the Financial Crimes Enforcement Network of the U.S. Department of Treasury (FinCEN). The CTA has significant implications for entities falling under its scope and failure to comply can lead to fines and civil penalties. For more information regarding the CTA, please visit www.fincen.gov/boi . There are several exceptions, most notably, CTA reporting does not apply to any company that is registered with FinCEN. WHO NEEDS TO FILE: A Reporting Company must report its name, business address, jurisdiction of formation, and EIN. Additionally, the Beneficial Owner Information must be filed for anyone who exercises substantial control over the Reporting Company or owns at least 25% of the company. A Beneficial Owner is an individual who directly or indirectly through any contract, arrangement, understanding, relationship, or otherwise EITHER exercises Substantial Control over the Reporting Company or Owns at least 25% of the ownership interests of the Reporting Company. There are several exceptions for a Beneficial Owner that include: a Beneficial Owner cannot be a minor child, an individual acting as a nominee, intermediary, custodian, or agent on behalf of another individual, or an individual acting solely as an employee of the Reporting Company. DEADLINES: Generally, entities formed in 2024 have only 90 days to submit their information. However, entities formed before 2024 have until January 1, 2025 to file. As noted below, we recommend prompt and early action. IDENTITY THEFT/FRAUD ALERT: FinCEN has issued a warning that criminals are using the CTA in fraudulent efforts to obtain personal information. Fraudulent correspondence about CTA may be titled "Important Compliance Notice '' and may ask the recipient to click on a URL or to scan a QR code. These e-mails or letters are fraudulent. FinCEN does not send unsolicited requests for CTA information. You should not click on links, scan QR codes, or provide personal information or copies of identification documents to anyone unless you know who they are and have asked them to handle your FinCEN submissions. PENDING COURT CHALLENGE: A federal court decision in Alabama held the CTA exceeds the authority of Congress and is unconstitutional. The decision had limited scope. In response FinCEN is limiting enforcement of the CTA against the National Small Business Association and its members. Enforcement continues against all other entities. Although courts can and do issue surprising decisions, a long line of Supreme Court cases give the federal government significant power to regulate commerce and financial transactions and combat money laundering. Our prediction is that this decision will eventually be overturned and the CTA will continue in effect. WE RECOMMEND PROMPT ACTION: Even if your entity was formed before 2024 and has the whole year to file, we recommend starting the process sooner, preferably by June 15, to ensure timely and accurate reporting. Prompt action will avoid possible system overloads towards the end of 2024 as millions of companies and individuals realize they face an urgent deadline. OVERVIEW OF THE FILING PROCESS: Beneficial ownership information refers to identifying information about the individuals who directly or indirectly control a company. Definitions of “beneficial owner” are provided on the FinCEN site. There is no filing fee, and all submissions must be completed through FinCEN’s BOI E-Filing Website ( https://boiefiling.fincen.gov ). In general, the information needed for the entity is: Full legal name Any doing business as (DBA) Complete current US address Jurisdiction of formation For a foreign reporting company, jurisdiction of first registration IRS Taxpayer Identification Number (SSN or EIN as appropriate) The necessary information for each beneficial owner is: Full legal name Date of Birth Complete current address Unique identifying number and issuing jurisdiction from one of the following non-expired documents: (1) US passport; (2) identification document issued by a State, local government, or Indian Tribe issued for the purpose of identifying the individual; (3) State-issued driver’s license; (4) if none are available, a foreign passport; and A picture of the identifying document. HOW TO GET ASSISTANCE: if you have any questions or concerns, please reach out. Cogent Law Group stands ready to answer questions, and many clients are asking us to handle the CTA submission on their behalf. Naturally, we will not take any action without your instructions and specific authorization, so if we do not hear from you, we will assume that you are independently handling CTA compliance.

The U.S. Government requested the Bahamian authorities to arrest Sam Bankman Fried (SBF) on December 12, 2022, based on a sealed indictment filed by the Southern District of New York. The arrest comes just over a month after the shocking implosion of the centralized exchange, FTX, which was trusted with over $32 billion of clients’ assets. The International arm of… The post The monumental fall from grace appeared first on Cogent Law.