U.S. Department of the Treasury’s Financial Crimes Enforcement Network now has a new requirement for all small business owners. They require companies to disclose information about their beneficial owners, senior officers, and other control persons to the federal government.
Many small business owners create LLCs—limited liability companies—created to protect the owners from being personally liable for business debts or lawsuits against the business. An LLC creates a separation between your business assets and your personal assets. This is a “corporate veil.” But now the U.S. Department of the Treasury’s Financial Crimes Enforcement Network wants to know who you are, what you own, and where you are.
Federal District Court
Since this requirement has been implemented, a federal district court judge in Alabama declared the Corporate Transparency Act (CTA) unconstitutional, ruling that the law’s mandatory disclosure requirements exceed Congress’ authority. However, the judge limited the scope of the ruling to apply only to the plaintiffs in the case. As expected, the federal government filed an appeal to the 11th Circuit Court of Appeals. We’ll see what happens.
Beneficial Ownership Information Report
In the past, I have talked about social credit scores, ESG scores, digital IDs, and 15-minute cities. All of those are in various stages of implementation. However, as of January 1, 2024, there is something mandatory for all small business owners: the BOI report. BOI stands for Beneficial Ownership Information Reports. If this report is not filed, the penalties will be severe. We are talking $500 daily fines and up to two years in jail. And if a business owner has established multiple businesses, they must file individually for each company.
The BOI Report was enacted through the Corporate Transparency Act, and as of January, it has become a mandatory filing for all small business owners. Business owners who had a registered business before January 2024 have until the end of the year to file. Still, anyone who started a business in 2024 has just ninety days from creating their new business to file this report. All beneficial owners must file this report. However, banks and insurance agencies are exempt.
So, the question then becomes, just who classifies as a beneficial owner? A beneficial owner is any individual who, directly or indirectly, exercises substantial control over a reporting company or owns or controls at least twenty-five percent of the ownership interests of a reporting company.
The BOI Report has fifty-one questions, and only some owners will have to answer all fifty-one questions. However, all reporting parties must supply their full legal name, date of birth, and a nonexpired document, such as their passport or driver’s license, complete with a photo ID in either a JPG or PDF.
FinCEN
Again, this report is under the United States Treasury Financial Crimes Enforcement Network, or FinCEN. You can file for a FinCEN Identifier, but you will still need to provide personal information to get one.
Why is the government requiring this? You will probably receive the answer that this system is designed to stop money laundering and funding terrorism. But, in reality, the purpose of this report comes down to why and what they require of and from individuals. They want to know who you are, what you own, and where they can find you.
Register.gov
Technology and surveillance have been taking over our lives for a while, but things are moving at an ever-changing and rapid pace. We are told this is for safety and is for transparency. However, that transparency only goes one way. For example, the government has a website called federalregister.gov. This site has an FAQ section where citizens can ask questions about new laws or requirements, such as the Beneficial Ownership Information report. One would notice the site’s typical response by looking at a screenshot from the FINCEN FAQ section regarding that report and requirement. There are two simple words used repeatedly: “No Comment.” This is designed to be transparent, but questions still need to be answered.
Harvard Law School
Last month, an online Harvard Law School forum explained this requirement for small business owners, announcing the implementation of the Corporate Transparency Act. The forum was published on September 30, 2022, and went into effect on January 1, 2024. Plaintiffs filed a lawsuit against the Treasury Department in November of 2022, alleging that the CTA’s (Corporate Transparency Act) disclosure requirements exceed Congress’s authority under Article I of the Constitution and violate the First, Fourth, Fifth, Ninth, and Tenth Amendments. On March 1, 2024, the U.S. District Court for the Northern District of Alabama held the Corporate Transparency Act (the “CTA”) unconstitutional.
Ephesians
Ephesians 5:11 tells believers to “not participate in the unfruitful deeds of darkness, but instead even expose them.” Ephesians 6:12-13 reminds believers: “For our struggle is not against flesh and blood, but against the rulers, against the powers, against the world forces of this darkness, against the spiritual forces of wickedness in the heavenly places. Therefore, take up the full armor of God so that you can resist in the evil day and, having done everything, stand firm.” First Peter 5:8 confirms that we are to “be on the alert. Your adversary, the devil, prowls around like a roaring lion, seeking someone to devour.”
2 Peter
In 2 Peter 2:13, Peter explains how false teachers do not try to hide their sins under the cover of darkness. They openly, in the daylight, pursue their greed and immorality. These verses paint a biblical picture of wickedness. There was a time when those who are of the world, those who do not accept Jesus as their Lord and Savior, when they sinned, they tried to at least hide it through lies and deceit. Now, sin is proudly and publicly proclaimed and endorsed. Anyone who speaks out against or takes a stand against sin is labeled and seen as wicked.
Romans
Evil is the perversion of what God has established. Romans 13 confirms that it was God’s plan for man to have government; however, that government was to seek and honor God and protect its people. A government that turns on its people. A government that surveils its people. A government that tracks its people. Is that the government God established? If not, then it is evil.
Isaiah
I wonder if God warned about this when He spoke through His prophet Isaiah and said: “Woe to those who call evil good, and good evil; who substitute darkness for light and light for darkness; who substitute bitter for sweet and sweet for bitter! Woe to those who are wise in their own eyes and clever in their own sight!” (Isaiah 5:20-21 NASB).
Maranatha, Lord Jesus!
