Doug Cornelius on compliance for private equity real estate
If you’re reading this, you’ve probably put a bunch of time into getting ready for compliance with the Beneficial Ownership Information reporting under the Corporate Transparency Act. You already know that there has been a nationwide injunction put in place to temporarily stop implementation of the requirements. Texas Top Cop Shop, Inc. v. Garland (E.D. Tex. … Read more »
Investments advisers had been excluded the definition of “financial institution” under the Bank Secrecy Act. At least until today. The Financial Crimes Enforcement Network at Treasury issued a final regulation today that changes that exclusion. Most registered investment advisers are now included in the definition and will have to comply with the strict requirements of … Read more »
The Bank Secrecy Act requires broker-dealers to file suspicious activity reports. Under the SAR Rule (31 C.F.R. § 1023.320(a)(2)), every broker-dealer has to file a report for a transaction of at $5000 that That’s all a bit vague. So FINRA has produced a list of more actionable items, most recently compiled in FINRA Regulatory Notice … Read more »
The Securities and Exchange Commission and the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) jointly proposed a new rule that would require SEC-registered investment advisers and exempt reporting advisers to have customer identification programs (CIPs). The proposed rule is designed to prevent illicit finance activity involving the customers of investment advisers. The … Read more »
On March 1, the US District Court in Northern Alabama ruled that the “Corporate Transparency Act is unconstitutional because it exceeds the Constitution’s limits on Congress’ power.” It’s not clear what effect this ruling is going to have on other parties and other jurisdictions. Congress passed the 2021 National Defense Authorization Act which included a … Read more »
We’ve been here before. FinCEN proposed anti-money laundering rules for investment advisers in 2003 and 2015. The pushback has been the Custody Rule, which requires a third-party to hold the client assets. That third-party will be doing the AML-KYC review. Those that are doing self-custody fall under existing AML rules. Since 2015, there has been … Read more »
The American Bar Association House of Delegates adopted a resolution that strengthens a lawyer’s obligation to decide before accepting or maintaining representation whether a client seeks to use the lawyer’s services to further a crime or fraud. This is part of an effort to alleviate concerns about the use of lawyers to facilitate money laundering … Read more »
Yesterday’s story on FinCEN planning new Real Estate Anti-Money Laundering Regulations is just part of the larger plan of the Biden administration’s plan to fight corruption. For more details check out the recently released United States Strategy on Countering Corruption. This is full of worthy goals. The stability of the US dollar is big lure … Read more »
The Financial Crimes Enforcement Network (FinCEN) has gotten more active in fighting money laundering. While the last administration mostly focused on putting parties on the sanctions list, the current administration is looking to expand regulatory requirements. One of the several initiative recently launched is targeted at real estate. On December 8, FinCEN announced an Advance Notice … Read more »
With the release of the Pandora Papers, there is a renewed focus on the illicit movement of money and filling the holes in anti-money laundering rules. “The Washington Post and other news organizations exposed the involvement of political leaders, examined the growth of the industry within the United States and demonstrated how secrecy shields assets … Read more »