I 

116TH CONGRESS 

1ST SESSION H. R. 2513 

To ensure that persons who form corporations or limited liability companies 

in the United States disclose the beneficial owners of those corporations 

or limited liability companies, in order to prevent wrongdoers from exploiting United States corporations and limited liability companies for 

criminal gain, to assist law enforcement in detecting, preventing, and 

punishing terrorism, money laundering, and other misconduct involving 

United States corporations and limited liability companies, and for other 

purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 3, 2019 

Mrs. CAROLYN B. MALONEY of New York (for herself, Mr. KING of New 

York, and Mr. MALINOWSKI) introduced the following bill; which was referred to the Committee on Financial Services 

A BILL 

To ensure that persons who form corporations or limited 

liability companies in the United States disclose the beneficial owners of those corporations or limited liability 

companies, in order to prevent wrongdoers from exploiting United States corporations and limited liability companies for criminal gain, to assist law enforcement in 

detecting, preventing, and punishing terrorism, money 

laundering, and other misconduct involving United States 

corporations and limited liability companies, and for 

other purposes. 


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1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Corporate Trans5 parency Act of 2019’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds the following: 

8 (1) Nearly 2,000,000 corporations and limited 

9 liability companies are being formed under the laws 

10 of the States each year. 

11 (2) Very few States require information about 

12 the beneficial owners of the corporations and limited 

13 liability companies formed under their laws. 

14 (3) A person forming a corporation or limited 

15 liability company within the United States typically 

16 provides less information at the time of incorpora17 tion than is needed to obtain a bank account or driv18 er’s license and typically does not name a single ben19 eficial owner. 

20 (4) Criminals have exploited State formation 

21 procedures to conceal their identities when forming 

22 corporations or limited liability companies in the 

23 United States, and have then used the newly created 

24 entities to commit crimes affecting interstate and 

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1 tion financing, drug and human trafficking, money 

2 laundering, tax evasion, counterfeiting, piracy, secu3 rities fraud, financial fraud, and acts of foreign cor4 ruption. 

5 (5) Law enforcement efforts to investigate cor6 porations and limited liability companies suspected 

7 of committing crimes have been impeded by the lack 

8 of available beneficial ownership information, as doc9 umented in reports and testimony by officials from 

10 the Department of Justice, the Department of 

11 Homeland Security, the Department of the Treas12 ury, and the Government Accountability Office, and 

13 others. 

14 (6) In July 2006, the leading international anti15 money laundering standard-setting body, the Finan16 cial Action Task Force on Money Laundering (in 

17 this section referred to as the ‘‘FATF’’), of which 

18 the United States is a member, issued a report that 

19 criticizes the United States for failing to comply 

20 with a FATF standard on the need to collect bene21 ficial ownership information and urged the United 

22 States to correct this deficiency by July 2008. In 

23 December 2016, FATF issued another evaluation of 

24 the United States, which found that little progress 

25 has been made over the last ten years to address 


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1 this problem. It identified the ‘‘lack of timely access 

2 to adequate, accurate and current beneficial owner3 ship information’’ as a fundamental gap in United 

4 States efforts to combat money laundering and ter5 rorist finance. 

6 (7) In response to the 2006 FATF report, the 

7 United States has urged the States to obtain bene8 ficial ownership information for the corporations and 

9 limited liability companies formed under the laws of 

10 such States. 

11 (8) In contrast to practices in the United 

12 States, all 28 countries in the European Union are 

13 required to have corporate registries that include 

14 beneficial ownership information. 

15 (9) To reduce the vulnerability of the United 

16 States to wrongdoing by United States corporations 

17 and limited liability companies with hidden owners, 

18 to protect interstate and international commerce 

19 from criminals misusing United States corporations 

20 and limited liability companies, to strengthen law en21 forcement investigations of suspect corporations and 

22 limited liability companies, to set a clear, universal 

23 standard for State incorporation practices, and to 

24 bring the United States into compliance with inter25 national anti-money laundering standards, Federal 


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1 legislation is needed to require the collection of bene2 ficial ownership information for the corporations and 

3 limited liability companies formed under the laws of 

4 such States. 

5 SEC. 3. TRANSPARENT INCORPORATION PRACTICES. 

6 (a) IN GENERAL.— 

7 (1) AMENDMENT TO THE BANK SECRECY

8 ACT.—Chapter 53 of title 31, United States Code, is 

9 amended by inserting after section 5332 the fol10 lowing new section: 

11 ‘‘§ 5333. Transparent incorporation practices 

12 ‘‘(a) REPORTING REQUIREMENTS.— 

13 ‘‘(1) BENEFICIAL OWNERSHIP REPORTING.— 

14 ‘‘(A) IN GENERAL.—Each applicant to 

15 form a corporation or limited liability company 

16 under the laws of a State or Indian Tribe shall 

17 file a report with FinCEN containing a list of 

18 the beneficial owners of the corporation or lim19 ited liability company that— 

20 ‘‘(i) except as provided in paragraph 

21 (3), and subject to paragraph (2), identi22 fies each beneficial owner by— 

23 ‘‘(I) full legal name; 

24 ‘‘(II) date of birth; 


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1 ‘‘(III) current residential or busi2 ness street address; and 

3 ‘‘(IV) a unique identifying num4 ber from a non-expired passport 

5 issued by the United States, a non-ex6 pired personal identification card, or a 

7 non-expired driver’s license issued by 

8 a State; and 

9 ‘‘(ii) if the applicant is not a bene10 ficial owner, also provides the identification 

11 information described in clause (i) relating 

12 to such applicant. 

13 ‘‘(B) UPDATED INFORMATION.—Each cor14 poration or limited liability company formed 

15 under the laws of a State or Indian Tribe 

16 shall— 

17 ‘‘(i) submit to FinCEN an annual fil18 ing containing a list of— 

19 ‘‘(I) the current beneficial owners 

20 of the corporation or limited liability 

21 company and the information de22 scribed in subparagraph (A) for each 

23 such beneficial owner; and 

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1 ited liability company during the pre2 vious year; and 

3 ‘‘(ii) pursuant to any rule issued by 

4 the Secretary of the Treasury under sub5 paragraph (C), update the list of the bene6 ficial owners of the corporation or limited 

7 liability company within the time period 

8 prescribed by such rule. 

9 ‘‘(C) RULEMAKING ON UPDATING INFOR10 MATION.—Not later than 9 months after the 

11 completion of the study required under section 

12 4(a)(1) of the Corporate Transparency Act of 

13 2019, the Secretary of the Treasury shall con14 sider the findings of such study and, if the Sec15 retary determines it to be necessary or appro16 priate, issue a rule requiring corporations and 

17 limited liability companies to update the list of 

18 the beneficial owners of the corporation or lim19 ited liability company within a specified amount 

20 of time after the date of any change in the list 

21 of beneficial owners or the information required 

22 to be provided relating to each beneficial owner. 

23 ‘‘(D) STATE AND INDIAN TRIBE NOTIFICA24 TION.—Each State and Indian Tribe in which 

25 a corporation or limited liability company is 


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1 being formed shall notify each applicant of the 

2 requirements listed in subparagraphs (A) and 

3 (B). 

4 ‘‘(2) CERTAIN BENEFICIAL OWNERS.—If an ap5 plicant to form a corporation or limited liability com6 pany or a beneficial owner, or similar agent of a cor7 poration or limited liability company who is required 

8 to provide identification information under this sub9 section, does not have a non-expired passport issued 

10 by the United States, a non-expired personal identi11 fication card, or a non-expired driver’s license issued 

12 by a State, each such person shall provide to 

13 FinCEN the full legal name, current residential or 

14 business street address, a unique identifying number 

15 from a non-expired passport issued by a foreign gov16 ernment, and a legible and credible copy of the 

17 pages of a non-expired passport issued by the gov18 ernment of a foreign country bearing a photograph, 

19 date of birth, and unique identifying information for 

20 each beneficial owner, and each application described 

21 in paragraph (1)(A) and each update described in 

22 paragraph (1)(B) shall include a written certification 

23 by a person residing in the State or Indian country 

24 under the jurisdiction of the Indian Tribe forming 


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1 the entity that the applicant, corporation, or limited 

2 liability company— 

3 ‘‘(A) has obtained for each such beneficial 

4 owner, a current residential or business street 

5 address and a legible and credible copy of the 

6 pages of a non-expired passport issued by the 

7 government of a foreign country bearing a pho8 tograph, date of birth, and unique identifying 

9 information for the person; 

10 ‘‘(B) has verified the full legal name, ad11 dress, and identity of each such person; 

12 ‘‘(C) will provide the information described 

13 in subparagraph (A) and the proof of verifica14 tion described in subparagraph (B) upon re15 quest of FinCEN; and 

16 ‘‘(D) will retain the information and proof 

17 of verification under this paragraph until the 

18 end of the 5-year period beginning on the date 

19 that the corporation or limited liability company 

20 terminates under the laws of the State or In21 dian Tribe. 

22 ‘‘(3) EXEMPT ENTITIES.— 

23 ‘‘(A) IN GENERAL.—With respect to an ap24 plicant to form a corporation or limited liability 

25 company under the laws of a State or Indian 


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1 Tribe, if such entity is described in subpara2 graph (C) or (D) of subsection (d)(4) and will 

3 be exempt from the beneficial ownership disclo4 sure requirements under this subsection, such 

5 applicant, or a prospective officer, director, or 

6 similar agent of the applicant, shall file a writ7 ten certification with FinCEN— 

8 ‘‘(i) identifying the specific provision 

9 of subsection (d)(4) under which the entity 

10 proposed to be formed would be exempt 

11 from the beneficial ownership disclosure re12 quirements under paragraphs (1) and (2); 

13 ‘‘(ii) stating that the entity proposed 

14 to be formed meets the requirements for 

15 an entity described under such provision of 

16 subsection (d)(4); and 

17 ‘‘(iii) providing identification informa18 tion for the applicant or prospective offi19 cer, director, or similar agent making the 

20 certification in the same manner as pro21 vided under paragraph (1) or (2). 

22 ‘‘(B) EXISTING CORPORATIONS OR LIM23 ITED LIABILITY COMPANIES.—On and after the 

24 date that is 2 years after the final regulations 

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1 tion or limited liability company formed under 

2 the laws of the State or Indian Tribe before 

3 such date shall be subject to the requirements 

4 of this subsection unless an officer, director, or 

5 similar agent of the entity submits to FinCEN 

6 a written certification— 

7 ‘‘(i) identifying the specific provision 

8 of subsection (d)(4) under which the entity 

9 is exempt from the requirements under 

10 paragraphs (1) and (2); 

11 ‘‘(ii) stating that the entity meets the 

12 requirements for an entity described under 

13 such provision of subsection (d)(4); and 

14 ‘‘(iii) providing identification informa15 tion for the officer, director, or similar 

16 agent making the certification in the same 

17 manner as provided under paragraph (1) 

18 or (2). 

19 ‘‘(C) EXEMPT ENTITIES HAVING OWNER20 SHIP INTEREST.—If an entity described in sub21 paragraph (C) or (D) of subsection (d)(4) has 

22 or will have an ownership interest in a corpora23 tion or limited liability company formed or to be 

24 formed under the laws of a State or Indian 

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1 ability company in which the entity has or will 

2 have the ownership interest shall provide the in3 formation required under this subsection relat4 ing to the entity, except that the entity shall 

5 not be required to provide information regard6 ing any natural person who has an ownership 

7 interest in, exercises substantial control over, or 

8 receives substantial economic benefits from the 

9 entity. 

10 ‘‘(4) RETENTION AND DISCLOSURE OF BENE11 FICIAL OWNERSHIP INFORMATION BY FINCEN.— 

12 ‘‘(A) RETENTION OF INFORMATION.—Ben13 eficial ownership information relating to each 

14 corporation or limited liability company formed 

15 under the laws of the State or Indian Tribe 

16 shall be maintained by FinCEN until the end of 

17 the 5-year period (or such other period of time 

18 as the Secretary of the Treasury may, by rule, 

19 determine) beginning on the date that the cor20 poration or limited liability company termi21 nates. 

22 ‘‘(B) DISCLOSURE OF INFORMATION.— 

23 Beneficial ownership information reported to 

24 FinCEN pursuant to this section shall be pro25 vided by FinCEN only upon receipt of— 


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1 ‘‘(i) subject to subparagraph (C), a 

2 request, through appropriate protocols, by 

3 a local, Tribal, State, or Federal law en4 forcement agency; 

5 ‘‘(ii) a request made by a Federal 

6 agency on behalf of a law enforcement 

7 agency of another country under an inter8 national treaty, agreement, or convention, 

9 or an order under section 3512 of title 18 

10 or section 1782 of title 28; or 

11 ‘‘(iii) a request made by a financial 

12 institution, with customer consent, as part 

13 of the institution’s compliance with due 

14 diligence requirements imposed under the 

15 Bank Secrecy Act, the USA PATRIOT 

16 Act, or other applicable Federal, State, or 

17 Tribal law. 

18 ‘‘(C) APPROPRIATE PROTOCOLS.— 

19 ‘‘(i) PRIVACY.—The protocols de20 scribed in subparagraph (B)(i) shall pro21 tect the privacy of any beneficial ownership 

22 information provided by FinCEN to a 

23 local, Tribal, State, or Federal law enforce24 ment agency. 


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1 ‘‘(ii) LIMITATION ON USE.—Beneficial 

2 ownership information provided to a local, 

3 Tribal, State, or Federal law enforcement 

4 agency under this paragraph may only be 

5 used for law enforcement, national secu6 rity, or intelligence purposes. 

7 ‘‘(b) NO BEARER SHARE CORPORATIONS OR LIM8 ITED LIABILITY COMPANIES.—A corporation or limited li9 ability company formed under the laws of a State or In10 dian Tribe may not issue a certificate in bearer form evi11 dencing either a whole or fractional interest in the cor12 poration or limited liability company. 

13 ‘‘(c) PENALTIES.— 

14 ‘‘(1) IN GENERAL.—It shall be unlawful for any 

15 person to affect interstate or foreign commerce by— 

16 ‘‘(A) knowingly providing, or attempting to 

17 provide, false or fraudulent beneficial ownership 

18 information, including a false or fraudulent 

19 identifying photograph, to FinCEN in accord20 ance with this section; 

21 ‘‘(B) willfully failing to provide complete or 

22 updated beneficial ownership information to 

23 FinCEN in accordance with this section; or 

24 ‘‘(C) knowingly disclosing the existence of 

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1 ership information reported pursuant to this 

2 section, except— 

3 ‘‘(i) to the extent necessary to fulfill 

4 the authorized request; or 

5 ‘‘(ii) as authorized by the entity that 

6 issued the subpoena, or other request. 

7 ‘‘(2) CIVIL AND CRIMINAL PENALTIES.—Any 

8 person who violates paragraph (1)— 

9 ‘‘(A) shall be liable to the United States 

10 for a civil penalty of not more than $10,000; 

11 and 

12 ‘‘(B) may be fined under title 18, United 

13 States Code, imprisoned for not more than 3 

14 years, or both. 

15 ‘‘(3) LIMITATION.—Any person who negligently 

16 violates paragraph (1) shall not be subject to civil or 

17 criminal penalties under paragraph (2). 

18 ‘‘(4) WAIVER.—The Secretary of the Treasury 

19 may waive the penalty for violating paragraph (1) if 

20 the Secretary determines that the violation was due 

21 to reasonable cause and was not due to willful ne22 glect. 

23 ‘‘(5) CRIMINAL PENALTY FOR THE MISUSE OR

24 UNAUTHORIZED DISCLOSURE OF BENEFICIAL OWN25 ERSHIP INFORMATION.—The criminal penalties proVerDate Sep 11 2014 20:53 May 06, 2019 Jkt 089200 PO 00000 Frm 00015 Fmt 6652 Sfmt 6201 E:\BILLS\H2513.IH H2513

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1 vided for under section 5322 shall apply to a viola2 tion of this section to the same extent as such crimi3 nal penalties apply to a violation described in section 

4 5322, if the violation of this section consists of the 

5 misuse or unauthorized disclosure of beneficial own6 ership information. 

7 ‘‘(d) DEFINITIONS.—For the purposes of this section: 

8 ‘‘(1) APPLICANT.—The term ‘applicant’ means 

9 any natural person who files an application to form 

10 a corporation or limited liability company under the 

11 laws of a State or Indian Tribe. 

12 ‘‘(2) BANK SECRECY ACT.—The term ‘Bank Se13 crecy Act’ means— 

14 ‘‘(A) section 21 of the Federal Deposit In15 surance Act; 

16 ‘‘(B) chapter 2 of title I of Public Law 91– 

17 508; and 

18 ‘‘(C) this subchapter. 

19 ‘‘(3) BENEFICIAL OWNER.— 

20 ‘‘(A) IN GENERAL.—Except as provided in 

21 subparagraph (B), the term ‘beneficial owner’ 

22 means a natural person who, directly or indi23 rectly, through any contract, arrangement, un24 derstanding, relationship, or otherwise— 


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1 ‘‘(i) exercises substantial control over 

2 a corporation or limited liability company; 

3 ‘‘(ii) owns 25 percent or more of the 

4 equity interests of a corporation or limited 

5 liability company; or 

6 ‘‘(iii) receives substantial economic 

7 benefits from the assets of a corporation or 

8 limited liability company. 

9 ‘‘(B) EXCEPTIONS.—The term ‘beneficial 

10 owner’ shall not include— 

11 ‘‘(i) a minor child, as defined in the 

12 State or Indian Tribe in which the entity 

13 is formed; 

14 ‘‘(ii) a person acting as a nominee, 

15 intermediary, custodian, or agent on behalf 

16 of another person; 

17 ‘‘(iii) a person acting solely as an em18 ployee of a corporation or limited liability 

19 company and whose control over or eco20 nomic benefits from the corporation or lim21 ited liability company derives solely from 

22 the employment status of the person; 

23 ‘‘(iv) a person whose only interest in 

24 a corporation or limited liability company 

25 is through a right of inheritance; 


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1 ‘‘(v) a creditor of a corporation or 

2 limited liability company, unless the cred3 itor also meets the requirements of sub4 paragraph (A); or 

5 ‘‘(vi) a person whose ownership inter6 est is below a de minimis threshold that 

7 the Secretary of the Treasury shall, by 

8 rule, establish. 

9 ‘‘(C) SUBSTANTIAL ECONOMIC BENEFITS

10 DEFINED.— 

11 ‘‘(i) IN GENERAL.—For purposes of 

12 subparagraph (A)(ii), a natural person re13 ceives substantial economic benefits from 

14 the assets of a corporation or limited liabil15 ity company if the person has an entitle16 ment to more than a specified percentage 

17 of the funds or assets of the corporation or 

18 limited liability company, which the Sec19 retary of the Treasury shall, by rule, estab20 lish. 

21 ‘‘(ii) RULEMAKING CRITERIA.—In es22 tablishing the percentage under clause (i), 

23 the Secretary of the Treasury shall seek 

24 to— 


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1 ‘‘(I) provide clarity to corpora2 tions and limited liability companies 

3 with respect to the identification and 

4 disclosure of a natural person who re5 ceives substantial economic benefits 

6 from the assets of a corporation or 

7 limited liability company; and 

8 ‘‘(II) identify those natural per9 sons who, as a result of the substan10 tial economic benefits they receive 

11 from the assets of a corporation or 

12 limited liability company, exercise a 

13 dominant influence over such corpora14 tion or limited liability company. 

15 ‘‘(4) CORPORATION; LIMITED LIABILITY COM16 PANY.—The terms ‘corporation’ and ‘limited liability 

17 company’— 

18 ‘‘(A) have the meanings given such terms 

19 under the laws of the applicable State or Indian 

20 Tribe; 

21 ‘‘(B) include any non-United States entity 

22 eligible for registration or registered to do busi23 ness as a corporation or limited liability com24 pany under the laws of the applicable State or 

25 Indian Tribe; 


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1 ‘‘(C) do not include any entity that is— 

2 ‘‘(i) a business concern that is an 

3 issuer of a class of securities registered 

4 under section 12 of the Securities Ex5 change Act of 1934 (15 U.S.C. 781) or 

6 that is required to file reports under sec7 tion 15(d) of that Act (15 U.S.C. 78o(d)); 

8 ‘‘(ii) a business concern constituted, 

9 sponsored, or chartered by a State or In10 dian Tribe, a political subdivision of a 

11 State or Indian Tribe, under an interstate 

12 compact between two or more States, by a 

13 department or agency of the United 

14 States, or under the laws of the United 

15 States; 

16 ‘‘(iii) a depository institution (as de17 fined in section 3 of the Federal Deposit 

18 Insurance Act (12 U.S.C. 1813)); 

19 ‘‘(iv) a credit union (as defined in sec20 tion 101 of the Federal Credit Union Act 

21 (12 U.S.C. 1752)); 

22 ‘‘(v) a bank holding company (as de23 fined in section 2 of the Bank Holding 

24 Company Act of 1956 (12 U.S.C. 1841)); 


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1 ‘‘(vi) a broker or dealer (as defined in 

2 section 3 of the Securities Exchange Act of 

3 1934 (15 U.S.C. 78c)) that is registered 

4 under section 15 of the Securities Ex5 change Act of 1934 (15 U.S.C. 78o); 

6 ‘‘(vii) an exchange or clearing agency 

7 (as defined in section 3 of the Securities 

8 Exchange Act of 1934 (15 U.S.C. 78c)) 

9 that is registered under section 6 or 17A 

10 of the Securities Exchange Act of 1934 

11 (15 U.S.C. 78f and 78q–1); 

12 ‘‘(viii) an investment company (as de13 fined in section 3 of the Investment Com14 pany Act of 1940 (15 U.S.C. 80a–3)) or 

15 an investment adviser (as defined in sec16 tion 202(11) of the Investment Advisers 

17 Act of 1940 (15 U.S.C. 80b–2(11))), if the 

18 company or adviser is registered with the 

19 Securities and Exchange Commission, or 

20 has filed an application for registration 

21 which has not been denied, under the In22 vestment Company Act of 1940 (15 U.S.C. 

23 80a–1 et seq.) or the Investment Adviser 

24 Act of 1940 (15 U.S.C. 80b–1 et seq.); 


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1 ‘‘(ix) an insurance company (as de2 fined in section 2 of the Investment Com3 pany Act of 1940 (15 U.S.C. 80a–2)); 

4 ‘‘(x) a registered entity (as defined in 

5 section 1a of the Commodity Exchange Act 

6 (7 U.S.C. 1a)), or a futures commission 

7 merchant, introducing broker, commodity 

8 pool operator, or commodity trading advi9 sor (as defined in section 1a of the Com10 modity Exchange Act (7 U.S.C. 1a)) that 

11 is registered with the Commodity Futures 

12 Trading Commission; 

13 ‘‘(xi) a public accounting firm reg14 istered in accordance with section 102 of 

15 the Sarbanes-Oxley Act (15 U.S.C. 7212) 

16 or an entity controlling, controlled by, or 

17 under common control of such a firm; 

18 ‘‘(xii) a public utility that provides 

19 telecommunications service, electrical 

20 power, natural gas, or water and sewer 

21 services, within the United States; 

22 ‘‘(xiii) a church, charity, nonprofit en23 tity, or other organization that is described 

24 in section 501(c), 527, or 4947(a)(1) of 

25 the Internal Revenue Code of 1986, that 


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1 has not been denied tax exempt status, and 

2 that has filed the most recently due annual 

3 information return with the Internal Rev4 enue Service, if required to file such a re5 turn; 

6 ‘‘(xiv) any business concern that— 

7 ‘‘(I) employs more than 20 em8 ployees on a full-time basis in the 

9 United States; 

10 ‘‘(II) files income tax returns in 

11 the United States demonstrating more 

12 than $5,000,000 in gross receipts or 

13 sales; and 

14 ‘‘(III) has an operating presence 

15 at a physical office within the United 

16 States; or 

17 ‘‘(xv) any corporation or limited liabil18 ity company formed and owned by an enti19 ty described in clause (i), (ii), (iii), (iv), 

20 (v), (vi), (vii), (viii), (ix), (x), (xi), (xii), 

21 (xiii), or (xiv); and 

22 ‘‘(D) do not include any individual busi23 ness concern or class of business concerns 

24 which the Secretary of the Treasury and the 

25 Attorney General of the United States have 


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1 jointly determined, by rule of otherwise, to be 

2 exempt from the requirements of subsection (a), 

3 if the Secretary and the Attorney General joint4 ly determine that requiring beneficial ownership 

5 information from the business concern would 

6 not serve the public interest and would not as7 sist law enforcement efforts to detect, prevent, 

8 or prosecute terrorism, money laundering, tax 

9 evasion, or other misconduct. 

10 ‘‘(5) FINCEN.—The term ‘FinCEN’ means the 

11 Financial Crimes Enforcement Network of the De12 partment of the Treasury. 

13 ‘‘(6) INDIAN COUNTRY.—The term ‘Indian 

14 country’ has the meaning given that term in section 

15 1151 of title 18. 

16 ‘‘(7) INDIAN TRIBE.—The term ‘Indian Tribe’ 

17 has the meaning given that term under section 102 

18 of the Federally Recognized Indian Tribe List Act of 

19 1994. 

20 ‘‘(8) PERSONAL IDENTIFICATION CARD.—The 

21 term ‘personal identification card’ means an identi22 fication document issued by a State, Indian Tribe, 

23 or local government to an individual solely for the 

24 purpose of identification of that individual. 


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1 ‘‘(9) STATE.—The term ‘State’ means any 

2 State, commonwealth, territory, or possession of the 

3 United States, the District of Columbia, the Com4 monwealth of Puerto Rico, the Commonwealth of the 

5 Northern Mariana Islands, American Samoa, Guam, 

6 or the United States Virgin Islands.’’. 

7 (2) RULEMAKING.— 

8 (A) IN GENERAL.—Not later than 1 year 

9 after the date of enactment of this Act, the Sec10 retary of the Treasury shall issue regulations to 

11 carry out this Act and the amendments made 

12 by this Act, including, to the extent necessary, 

13 to clarify the definitions in section 5333(d) of 

14 title 31, United States Code. 

15 (B) REVISION OF FINAL RULE.—Not later 

16 than 1 year after the date of enactment of this 

17 Act, the Secretary of the Treasury shall revise 

18 the final rule titled ‘‘Customer Due Diligence 

19 Requirements for Financial Institutions’’ (May 

20 11, 2016; 81 Fed. Reg. 29397) to— 

21 (i) bring the rule into conformance 

22 with this Act and the amendments made 

23 by this Act; 

24 (ii) account for financial institutions’ 

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1 ship information filed by corporations and 

2 limited liability companies, under threat of 

3 civil and criminal penalties, under this Act 

4 and the amendments made by this Act; 

5 and 

6 (iii) reduce any burdens on financial 

7 institutions that are, in light of the enact8 ment of this Act and the amendments 

9 made by this Act, unnecessary or duplica10 tive. 

11 (3) CONFORMING AMENDMENTS.—Title 31, 

12 United States Code, is amended— 

13 (A) in section 5321(a)— 

14 (i) in paragraph (1), by striking ‘‘sec15 tions 5314 and 5315’’ each place it ap16 pears and inserting ‘‘sections 5314, 5315, 

17 and 5333’’; and 

18 (ii) in paragraph (6), by inserting 

19 ‘‘(except section 5333)’’ after ‘‘sub20 chapter’’ each place it appears; and 

21 (B) in section 5322, by striking ‘‘section 

22 5315 or 5324’’ each place it appears and insert23 ing ‘‘section 5315, 5324, or 5333’’. 

24 (4) TABLE OF CONTENTS.—The table of con25 tents of chapter 53 of title 31, United States Code, 


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1 is amended by inserting after the item relating to 

2 section 5332 the following: 

‘‘Sec. 5333. Transparent incorporation practices.’’. 

3 (b) FUNDING AUTHORIZATION.— 

4 (1) IN GENERAL.—To carry out section 5333 of 

5 title 31, United States Code, as added by subsection 

6 (a), funds shall be made available to the Financial 

7 Crimes Enforcement Network (in this subsection re8 ferred to as ‘‘FinCEN’’) to pay reasonable costs re9 lating to compliance with the requirements of such 

10 section. 

11 (2) FUNDING SOURCES.—Funds shall be pro12 vided to FinCEN to carry out the purposes de13 scribed in paragraph (1) from one or more of the 

14 following sources: 

15 (A) Upon application by FinCEN, and 

16 without further appropriation, the Secretary of 

17 the Treasury shall make available to the 

18 FinCEN unobligated balances described in sec19 tion 9703(g)(4)(B) of title 31, United States 

20 Code, in the Department of the Treasury For21 feiture Fund established under section 9703(a) 

22 of title 31, United States Code. 

23 (B) Upon application by FinCEN, after 

24 consultation with the Secretary of the Treasury, 

25 and without further appropriation, the Attorney 


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1 General of the United States shall make avail2 able to FinCEN excess unobligated balances (as 

3 defined in section 524(c)(8)(D) of title 28, 

4 United States Code) in the Department of Jus5 tice Assets Forfeiture Fund established under 

6 section 524(c) of title 28, United States Code. 

7 (3) MAXIMUM AMOUNTS.— 

8 (A) DEPARTMENT OF THE TREASURY.— 

9 The Secretary of the Treasury may not make 

10 available to FinCEN a total of more than 

11 $30,000,000 under paragraph (2)(A). 

12 (B) DEPARTMENT OF JUSTICE.—The At13 torney General of the United States may not 

14 make available to FinCEN a total of more than 

15 $10,000,000 under paragraph (2)(B). 

16 (c) FEDERAL CONTRACTORS.—Not later than the 

17 first day of the first full fiscal year beginning at least 1 

18 year after the date of the enactment of this Act, the Ad19 ministrator for Federal Procurement Policy shall revise 

20 the Federal Acquisition Regulation maintained under sec21 tion 1303(a)(1) of title 41, United States Code, to require 

22 any contractor or subcontractor who is subject to the re23 quirement to disclose beneficial ownership information 

24 under section 5333 of title 31, United States Code, to pro25 vide the information required to be disclosed under such 


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1 section to the Federal Government as part of any bid or 

2 proposal for a contract with a value threshold in excess 

3 of the simplified acquisition threshold under section 134 

4 of title 41, United States Code. 

5 SEC. 4. STUDIES AND REPORTS. 

6 (a) UPDATING OF BENEFICIAL OWNERSHIP INFOR7 MATION.— 

8 (1) STUDY.—The Secretary of the Treasury, in 

9 consultation with the Attorney General of the United 

10 States, shall conduct a study to evaluate— 

11 (A) the necessity of a requirement for cor12 porations and limited liability companies to up13 date the list of their beneficial owners within a 

14 specified amount of time after the date of any 

15 change in the list of beneficial owners or the in16 formation required to be provided relating to 

17 each beneficial owner, taking into account the 

18 annual filings required under section 

19 5333(a)(1)(B)(i) of title 31, United States 

20 Code, and the information contained in such 

21 annual filings; and 

22 (B) the burden that a requirement to up23 date the list of beneficial owners within a speci24 fied period of time after a change in such list 


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1 of beneficial owners would impose on corpora2 tions and limited liability companies. 

3 (2) REPORT.—Not later than 1 year after the 

4 date of enactment of this Act, the Secretary of the 

5 Treasury shall submit a report on the study required 

6 under paragraph (1) to the Committee on Financial 

7 Services of the House of Representatives and the 

8 Committee on Banking, Housing, and Urban Affairs 

9 of the Senate 

10 (3) PUBLIC COMMENT.—The Secretary of the 

11 Treasury shall seek and consider public input, com12 ments, and data in order to conduct the study re13 quired under subparagraph paragraph (1). 

14 (b) OTHER LEGAL ENTITIES.—Not later than 2 

15 years after the date of enactment of this Act, the Comp16 troller General of the United States shall conduct a study 

17 and submit to the Congress a report— 

18 (1) identifying each State or Indian Tribe that 

19 has procedures that enable persons to form or reg20 ister under the laws of the State or Indian Tribe 

21 partnerships, trusts, or other legal entities, and the 

22 nature of those procedures; 

23 (2) identifying each State or Indian Tribe that 

24 requires persons seeking to form or register partner25 ships, trusts, or other legal entities under the laws 


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1 of the State or Indian Tribe to provide information 

2 about the beneficial owners (as that term is defined 

3 in section 5333(d)(1) of title 31, United States 

4 Code, as added by this Act) or beneficiaries of such 

5 entities, and the nature of the required information; 

6 (3) evaluating whether the lack of available 

7 beneficial ownership information for partnerships, 

8 trusts, or other legal entities— 

9 (A) raises concerns about the involvement 

10 of such entities in terrorism, money laundering, 

11 tax evasion, securities fraud, or other mis12 conduct; and 

13 (B) has impeded investigations into enti14 ties suspected of such misconduct; and 

15 (4) evaluating whether the failure of the United 

16 States to require beneficial ownership information 

17 for partnerships and trusts formed or registered in 

18 the United States has elicited international criticism 

19 and what steps, if any, the United States has taken 

20 or is planning to take in response. 

21 (c) EFFECTIVENESS OF INCORPORATION PRAC22 TICES.—Not later than 5 years after the date of enact23 ment of this Act, the Comptroller General of the United 

24 States shall conduct a study and submit to the Congress 

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1 tices implemented under this Act and the amendments 

2 made by this Act in— 

3 (1) providing law enforcement agencies with 

4 prompt access to reliable, useful, and complete bene5 ficial ownership information; and 

6 (2) strengthening the capability of law enforce7 ment agencies to combat incorporation abuses, civil 

8 and criminal misconduct, and detect, prevent, or 

9 punish terrorism, money laundering, tax evasion, or 

10 other misconduct. 

11 SEC. 5. DEFINITIONS. 

12 In this Act, the terms ‘‘beneficial owner’’, ‘‘corpora13 tion’’, and ‘‘limited liability company’’ have the meaning 

14 given those terms, respectively, under section 5333(d) of 

15 title 31, United States Code. 

Æ 


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