This week, U.S. Sens. Marco Rubio, R-Fla., and Elizabeth Warren, D-Mass., led a letter to U.S. Treasury Sec. Janet Yellen and Acting Director of the Financial Crimes Enforcement Network (FinCEN) Himamauli Das regarding the delayed implementation of Rubio’s Corporate Transparency Act (CTA), which was signed into law in 2020 (P.L. 116-283).
U.S Sens. Bill Cassidy, R-La., Chuck Grassley, R-Iowa, Bob Menendez, D-NJ, Sheldon Whitehouse, D-RI, and Ron Wyden, D-Oreg., also signed the letter.
Rubio first introduced the bipartisan Corporate Transparency Act with Wyden in August 2017. In August 2018, Rubio, Wyden and Whitehouse succeeded in passing bipartisan legislation to lay the groundwork to expand a Treasury initiative to curb foreign nationals laundering money through high-end real estate. In December 2020, Rubio secured anti-money laundering and beneficial ownership provisions, modeled after the CTA, in the FY21 National Defense Authorization Act. In May 2021, Rubio and colleagues sent a bipartisan comment to FinCEN urging the efficient, effective implementation of a beneficial ownership reporting system, as required by the CTA.
The letter is below.
We write to urge the Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) to swiftly implement the Corporate Transparency Act (CTA).
Passed by Congress last year, the CTA is landmark legislation to upgrade our country’s anti-money laundering laws. “For years, experts routinely ranked anonymous shell companies— where the true, ‘beneficial’ owners are unknown—as the biggest weakness in our anti-money laundering safeguards.” The CTA directly tackled this problem by requiring FinCEN to create a national registry of beneficial owners of companies within the United States, bolstering our nation’s efforts to combat kleptocracy, transnational crime, terrorism, and other illicit activity.
Vladimir Putin’s invasion of Ukraine has only amplified the importance of the CTA. The federal government cannot properly implement sanctions against Putin and his oligarchs if it does not know the full extent of their holdings. But recent reporting suggests that the Treasury Department presently lacks this information, underscoring the urgent need for beneficial ownership disclosure as required by the CTA to protect America’s financial stability and national security.
Nevertheless, the Treasury Department has yet to finalize the implementation of the CTA —or even set a timetable for its completion. We appreciate that FinCEN is working with limited resources, and Congress is working to remedy that through the appropriations process. Still, over four months after the statutory deadline for implementation, FinCEN has only proposed one of its three CTA rules. In various hearings last month, both of you could only commit to proposing the second CTA rule by the end of “this year.” These delays run contrary to the clear instructions of Congress, undermine American efforts to respond to Russia’s war against Ukraine, and hinder broader efforts to protect the U.S. financial system against the threat of illicit finance.
For these reasons, we respectfully request that FinCEN immediately accelerate its implementation of the Corporate Transparency Act and provide an update and a detailed timeline on your efforts to do so no later than May 23, 2022. Thank you for your attention to this important matter.
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