Are you a business customer filing Beneficial Ownership Information? Here’s what to know.

NOTE: According to the Financial Crimes Enforcement Network (FinCEN), reporting companies are not required to file beneficial ownership reports for as long as the current, nationwide injunction of the Corporate Transparency Act remains in effect. Reporting companies will have no liability for failing to file required beneficial ownership reports during the pendency of the injunction and FinCEN will continue to accept beneficial ownership reports from reporting companies on a voluntary basis.

The holidays are a busy time of year, so perhaps now more than any other season, things can get missed. That’s why we want to share some crucial information with our business customers that are reporting companies for beneficial ownership information (BOI). As the filing periods draw closer, we also have some helpful insights on how to avoid the growing threat of fraud schemes and scams.

First thing’s first: For those who may be unsure, BOI is basically details about the individuals who own or control a company. Businesses are required to disclose these owners to financial institutions, regulators, and in some cases, the public. Here in the United States, the Corporate Transparency Act mandates these disclosures to the Financial Crimes Enforcement Network (FinCEN).

As far as the types of businesses required to file, they are classified as the following:

• Domestic companies are corporations, limited liability companies, and any other entities created by the filing of a document with a secretary of state or any similar office in the United States.


• Foreign companies are entities (including corporations and limited liability companies) formed under the law of a foreign country that have registered to do business in the United States by the filing of a document with a secretary of state or any similar office.

So if you’re required to report your company’s BOI to FinCEN, you have to do so through a secure, electronic filing system available here. Once there, simply select “File BOIR.” Worth noting is that the deadline is drawing near but varies:

• A reporting company created or registered to do business before January 1, 2024, will have until January 1, 2025 to file its initial beneficial ownership information report.


• A reporting company created or registered on or after January 1, 2024, and before January 1, 2025, will have 90 calendar days after receiving notice of the company’s creation or registration to file its initial BOI report.


• Reporting companies created or registered on or after January 1, 2025, will have 30 calendar days from actual or public notice that the company’s creation or registration is effective to file their initial BOI reports with FinCEN.

Additional information on BOI is available here.

Deadlines aside, the filing of BOI is a central issue for a lot of companies. While the filings are intended to promote transparency and curb illegal activities like fraud and money laundering, they also can expose businesses to cybercrimes and fraud.

One of the biggest risks businesses are facing is the growing threat of phishing scams. Fraudsters know that companies have to submit sensitive ownership data to government agencies or third-party service providers, so they compile emails posing as regulators or trusted partners. They fool business owners or employees into providing the required details or access to their online filing systems. The emails create a feeling of pressure by including urgent deadlines or threats of fines.

Yet another risk is the exploitation of false filings or errors in reporting, which can be difficult to reverse. Fraudsters are going so far as impersonating a business’s beneficial owners or manipulating the submission process to add fraudulent details. This can allow criminals to mask their involvement in businesses used for money laundering or other illegal activities, or create discrepancies in ownership records.

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Lastly, businesses that rely on third-party services to file their BOI are at risk of service-provider fraud. Scammers can pose as legitimate filing agencies, charging ridiculous fees or offering services that don’t fulfill regulatory requirements. In some cases, fraudulent service providers may disappear after collecting fees, leaving businesses without the necessary filings in place to comply with the law.

The need to protect against fraud has never been greater because of the complexity of BOI filings, so businesses have to stay vigilant about protecting themselves.

That includes:

• Verifying the legitimacy of any emails or communications regarding filing, using secure channels for submitting sensitive information.


• Conducting thorough due diligence when selecting third-party service providers.