The U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) has a new plan to fight against bad financial activities. They want to give government groups, police, and banks access to information about who owns certain companies, starting in 2024. This move is part of President Joe Biden’s and lawmakers’ efforts to stop corruption and money laundering. The rule, finalized, makes it necessary for companies to tell everyone who owns them, especially if someone owns a lot.

The Financial Crimes Enforcement Network (FinCEN) within the U.S. Treasury Department outlined plan to grant specific government-agencies, law-enforcement, and financial-firms access to fresh details about ownership of shell companies. Starting in 2024, FinCEN will require certain companies to disclose data about who owns them, as part of President Joe Biden’s and lawmakers’ initiative to combat corruption and money laundering.

New rule, finalized on Thursday, follows passage of Corporate Transparency Act in 2021, law aimed at addressing illicit financial activities. A year ago, FinCEN initially proposed a plan to allow access to a comprehensive database containing detailed financial information on companies operating in the U.S., sparking privacy concerns.

Beneficial owners, individuals with 25% ownership stake, majority of voting power, or substantial control, will be obligated to report ownership.

FinCEN’s strategy involves launching trial program with select group of government agencies before expanding access to other federal agencies, and state, local, and tribal authorities. Ultimately, FinCEN aims to share data with foreign governments and financial firms to facilitate customer due diligence.

Lastly, Treasury Secretary Janet Yellen emphasized, “This illicit money flowing in from around world undermines fair business competition and poses a risk to our country’s economic and national security. Thanks to the new beneficial ownership framework, we are making significant progress toward addressing this issue.

Conclusion

In 2024, new rule from FinCEN will make companies share information about their owners to help stop bad financial activities. This is following a law from 2021. The rule wants people with a big ownership in a company to say who they are. Moreover, FinCEN plans to start with a trial for some government groups and later share this information with other government agencies, local authorities, and even with other countries and banks. Furthermore, this step aims to not only protect the U.S. from economic and security risks but also to work together with other countries to stop illegal money movements, according to Treasury Secretary Janet Yellen.