A new Beneficial Ownership Information (BOI) reporting requirement by the Financial Crimes Enforcement Network (FinCEN) will be going into effect January 1, 2024. Companies operating in the United States will need to provide information to FinCEN regarding the beneficial owners of their entities, unless they meet one of the exemptions provided.
Investment advisers are granted an exemption to the reporting requirement, but this exemption only applies to SEC-registered advisers. (See page 7 of the Small Entity Compliance Guide.) The reason for this, as stated in the release notes of the final rule, is "With respect to state-registered investment advisers, the extent of state supervision varies significantly, and FinCEN accordingly does not believe that seeking a blanket exemption for state-registered entities is warranted at this time." So that makes it clear that state-registered advisers will need to comply with the reporting requirements.
Still unknown: HOW to fulfill the reporting requirements. The platform is still being built and has not been released. The anticipated ETA is January. So we'll need to take a look at this again after the first of the year. I've added it to the 1/4 meeting agenda. Not sure if we'll know anything then, but just making sure it stays on our compliance minds. The good news is that for existing entities, the deadline to complete the reporting is 12/31/2024.
If you are a state-registered investment adviser, you'll need to comply with the reporting requirements. In addition, if you have clients that operate business entities, you may wish to alert them of this new requirement as well. Additional information can be found on the FinCEN website.