Notice of Filing of Amendment to the National Market System Plan Governing the Consolidated Audit Trail
SIFMA provided comments to the U.S. Securities and Exchange Commission (SEC) addressing the Notice of Filing of Amendment to the…
May 5, 2021
VIA ELECTRONIC SUBMISSION
Financial Crimes Enforcement Network
P.O. Box 39
Vienna, VA 22183
Re: FinCEN Advance Notice of Proposed Rulemaking on Beneficial Ownership Information Reporting Requirements (Docket Number FINCEN-2021-0005, RIN 1506-AB49)
Dear Sir or Madam:
The Securities Industry and Financial Markets Association (“SIFMA”)1 appreciates the opportunity to submit comments to the Financial Crimes Enforcement Network (“FinCEN”) on its advance notice of proposed rulemaking (“ANPRM”) regarding the beneficial ownership information reporting requirements in the Corporate Transparency Act (“CTA”). SIFMA and its member financial institutions commend FinCEN for issuing the ANRPM and for soliciting comments from the public as it considers how best to implement this important new law.
SIFMA strongly supports the objectives of the CTA to protect U.S. national security interests and to better enable efforts to counter money laundering, terrorism financing, and other illicit activity by making it more difficult for malign actors to conceal their ownership of corporations, limited liability companies (“LLCs”), and other similar entities in the United States. SIFMA encourages FinCEN, in promulgating rules implementing the CTA, to remain alert to Congress’s instruction to reduce any burdens on both financial institutions and reporting companies that are unnecessary or duplicative.2
To achieve the CTA’s objectives, it is important that FinCEN’s database collect and maintain accurate and reliable beneficial ownership information, with sufficient access given to financial institutions to help them meet their customer due diligence and other anti-money laundering (“AML”) compliance obligations.
In this letter, we focus on three key topics: (1) alignment of the FinCEN database and its requirements with the requirements of FinCEN’s customer due diligence rule (“CDD Rule”); (2) creation of a robust database on which financial institutions can rely, if they so choose, and have access for their CDD Rule and related AML compliance purposes; and (3) FinCEN’s outreach to reporting companies and financial institutions regarding their obligations under the CTA. SIFMA and its member firms – which include broker-dealers and banks with customer due diligence and related AML obligations – believe that focusing on these topics and the related questions that FinCEN has raised in the ANPRM will be critical in ensuring that the FinCEN database is a well-functioning tool that supports law enforcement and financial sector efforts to combat illicit financial activity while mitigating burdens on impacted stakeholders.
1 SIFMA is the leading trade association for broker-dealers, investment banks, and asset managers operating in the U.S. and global capital markets. On behalf of our industry’s nearly one million employees, we advocate for legislation, regulation, and business policy affecting retail and institutional investors, equity and fixed income markets, and related products and services. We serve as an industry coordinating body to promote fair and orderly markets, informed regulatory compliance, and efficient market operations and resiliency. We also provide a forum for industry policy and professional development. With offices in New York and Washington, D.C., SIFMA is the U.S. regional member of the Global Financial Markets Association (GFMA).
2 CTA § 6403(d)(1)(C)