US Companies Suddenly Mandated To Reveal Ownership Under New Law

Story by Claire O’Hare, State of the Union, 1/14/24

Treasury Secretary Janet Yellen has announced that 100,000 businesses have joined a new database collecting “beneficial ownership” information to reveal shell company owners.

This effort aims to increase corporate transparency and prevent the misuse of shell companies.

Yellen also discussed upcoming real estate rules to enhance transparency in property ownership. 

Yellen said, “Around the world, lack of transparency, specifically due to opaque corporate structures, makes it easier to conceal illicit activity.”

“Information on beneficial ownership will support our law enforcement colleagues in making arrests, prosecuting offenders, and seizing ill-gotten assets,” she continued.

“The benefits of increasing corporate transparency through gathering beneficial ownership information —put simply, knowing who owns what — start with protecting our national security,” explained the Biden official.

“Corporate transparency can bring economic benefits as well: protecting our financial system, reducing due diligence costs, enabling fair business competition, and increasing tax revenue,” concluded Yellen.

The bipartisan Corporate Transparency Act, signed in 2021, mandates most U.S. firms to report identifying information about their ownership.

Additionally, Yellen mentioned Treasury’s consideration of further steps to address risks associated with commercial real estate, emphasizing the benefits of corporate transparency in protecting national security and the financial system.