Congress recently passed the National Defense Authorization Act (NDAA) for FY2021 over a presidential veto. NDAA is an annual defense spending bill. The legislation included major Bank Secrecy Act (BSA) and other key anti-money laundering reforms. One of the major reforms included was the required collection of beneficial ownership information by the Financial Crimes Enforcement Network (FinCEN), a bureau within the U.S. Department of Treasury. Under the new law, beneficial owners (any natural person owning 25 percent or more of a legal entity) are required to disclose their personal information to FinCEN at the time the legal entity is formed under state law.
NAR has advocated for and supported pragmatic, risk-based anti-money laundering reforms, including the disclosure of beneficial ownership to the FinCEN in an effort to prevent the formation and use of anonymous shell companies by bad actors for illicit purposes. In October 2020, NAR along with other industry groups sent a letter to the Armed Services chairs and ranking members in both the House and Senate in support of this bill. Over the past two years, NAR has also supported the COUNTER Act, the Corporate Transparency Act of 2019, and the ILLICIT CASH Act to advance this issue.
NAR applauds Congress for passage of this legislation, and will continue to provide additional anti-money laundering updates and information.