Publication | BRG
Client Alert: Congress Passes Corporate Transparency Act
Walter Mix and David Abshier
On December 11, 2020, Congress passed the Anti-Money Laundering Act of 2020 (AMLA) as part of the National Defense Authorization Act (NDAA) for Fiscal Year 2021. The AMLA is a wide-ranging reform effort seeking to overhaul and modernize important financial security controls used to identify and prevent money laundering and other illicit activity conducted through financial transactions. The AMLA also enhances rewards and protections for whistleblowers coming forward with potential Bank Secrecy Act (BSA) violations.
Included in the AMLA is the Corporate Transparency Act (CTA). The CTA requires most corporations and limited liability companies established in the United States to disclose their true beneficial owners to the Treasury Department, effectively banning anonymous shell companies. The CTA is a victory for law enforcement and rights groups in the battle against money laundering, illicit money flows, and terrorist financing; allows greater sharing of information between law enforcement and regulators; and authorizes new suspicious activity monitoring tools.
The NDAA passed both houses of Congress by a wide margin and is likely to withstand any potential veto by the executive branch.