ANALYSIS: NDAA Would Step Toward Entity Ownership Transparency

The Corporate Transparency Act, part of the mammoth 2021 National Defense Authorization Act awaiting presidential signature, will, for the first time, establish beneficial ownership reporting requirements for U.S.-based businesses, addressing a longstanding concern that ownership anonymity facilitates money laundering and other financial crime in the United States.

Under the CTA, the Treasury Department will maintain beneficial ownership information in confidence and under tight security controls and make it available only to law enforcement agencies and financial institutions upon proper request. Public access is not permitted. “Shell” companies—those with little-to-no operating presence—are the principal targets of the new reporting requirements.

For ...