FinCEN continues outreach on BOI reporting, may release YouTube videos

As Treasury’s Financial Crimes Enforcement Network (FinCEN) builds awareness of the new beneficial ownership information (BOI) reporting rules that will affect millions of businesses, YouTube and other communication tools are on the table, the agency director said Tuesday.

Andrea Gacki was named as FinCEN’s director in mid-July after about five years as director of Treasury’s Office of Foreign Assets Control (OFAC). She gave the keynote address Tuesday at a conference of the Association of Certified Anti-Money Laundering Specialists.

“We are going all out to all forms of media to educate about beneficial ownership information and reporting, so not only will we be leveraging web like the YouTube series that OFAC did, but also leveraging every other type of outreach, through our website, through partnership with different public affairs outfits,” Gacki said. “We are definitely trying to get the message out. We’ll be working with stakeholders, and we’ve gone on the road so far to engage with small businesses and different congressional districts. You can expect that we will continue that. We will partner with stakeholder organizations, especially at the secretary-of-state level.”

In her former position, Gacki spoke in a video, “Introduction to OFAC Series – Episode 1,” which has over 17,000 views since late July. Episode 2, led by a different OFAC official, was posted about a month ago.

The BOI reporting requirement is an anti-money laundering initiative enacted through the Corporate Transparency Act, P.L. 116-283, in 2021, mandating that BOI be reported to FinCEN. The requirement would apply to most companies. FinCEN estimates that about 6.6 million BOI update reports will be filed in 2024, and about 14.5 million such reports will be filed annually for 2025 and beyond. The total five-year average of expected BOI update reports is almost 12.9 million.

Despite the extra work for both the companies and FinCEN, BOI reporting is necessary to catch “illicit actors” who use opaque corporate structures “to facilitate money laundering, corruption, sanctions and tax evasion, drug trafficking, fraud, and a host of other criminal offenses with impunity …” Gacki said.

In September, FinCEN published a Small Entity Compliance Guide and issued a Notice of Proposed Rulemaking that would extend the deadline for companies created or registered in 2024 to file their first BOI reports.

FinCEN also is reaching out to state, local, and tribal governments and state financial institution supervisors, Gacki said.

Last week, FinCEN updated its FAQs on BOI reporting requirements, including answers to questions such as “Is a member of a reporting company’s board of directors always a beneficial owner of the reporting company?” and “Can a parent company file a single BOI report on behalf of its group of companies?”

It also opened a 30-day comment period on consideration of an alternative way for companies to advise that they do not yet have some details about a beneficial owner or company applicant and a 30-day period for comments on the application that FinCEN intends to require individuals to use to obtain a FinCEN identifier. Comments for both are due by Oct. 30.

Previously, FinCEN said it would open a contact center dedicated to BOI.

“We’re working hard to create a framework where most small businesses should be able to file their beneficial ownership information on their own,” Gacki said.

Other issues include security and confidentiality of the BOI and verification of the information. Gacki indicated FinCEN has a handle on the former, saying “only authorized users can access the information for authorized purposes to protect national security and to fight crime.”

She seemed less certain about verification of the information that will be in the BOI database. “We operate in a resource-constrained world, just to put it bluntly, but verification as an objective is something we’re driving toward.”

— To comment on this article or to suggest an idea for another article, contact Martha Waggoner at Martha.Waggoner@aicpa-cima.com.