Reported by FACT Coalition

(Summary version reported below)

The House Financial Services Subcommittee on National Security, Illicit Finance, and International Financial Institutions held a hearing regarding the implementation of the Corporate Transparency Act (CTA). The act requires certain entities operating within the U.S. to report their true beneficial owners to FinCEN. Witnesses, including Gary Kalman from Transparency International-U.S. and Pete Selenke representing the American Bankers Association (ABA), highlighted the need for significant revisions to the draft rulemakings implementing the CTA. They emphasized the importance of financial institutions being able to access the collected beneficial ownership information for their anti-money laundering and counter-terrorism financing responsibilities.

Both witnesses stressed the significance of verifying the data submitted to the registry. Gary Kalman emphasized the need for adequate funding for FinCEN to access other databases and ensure compatibility for effective implementation. Similarly, Pete Selenke emphasized the importance of the registry being a reliable and accurate source of information, as any doubt about its accuracy could hinder banks’ use of the database.

Funding was a critical concern, with Rep. Joyce Beatty noting that proposed budget cuts for FY2024 might lead to layoffs in core staff working on CTA implementation. Mr. Kalman advocated for additional funding to drive timely implementation, address compliance inquiries from businesses and financial institutions, and ensure effective verification of the collected information.

Read source: https://thefactcoalition.org/house-hearing-puts-beneficial-ownership-implementation-on-center-stage-just-the-facts-7-20-23/

Watch video of hearing: https://financialservices.house.gov/calendar/eventsingle.aspx?EventID=408901