BLOG

In response to the growing need for transparency in financial transactions, FinCEN has rolled out an updated FAQ section on the accessibility of Beneficial Ownership Information (BOI). This marks a significant step in ensuring that authorized parties can access vital information to help combat illicit finance. Below is a breakdown of the key updates regarding when and how Federal agencies can access BOI, and what steps are required for them to request it.

A Phased Approach to BOI Access

FinCEN’s strategy for granting access to BOI follows a carefully planned phased approach, ensuring secure and responsible dissemination of sensitive data. Here’s what to expect in each phase:

• Phase 1: Federal Agency Pilot Program (Spring 2024) The first phase kicked off with a pilot program limited to a few Federal agency users. This step was essential for testing the processes and protocols to ensure smooth access and usage of BOI.
• Phase 2: Expanded Federal Agency Access (Late Summer 2024) As of late Summer 2024, the second phase opened the opportunity for other Federal agencies involved in law enforcement, national security, and intelligence activities to request access to BOI. These agencies already have memoranda of understanding (MOU) in place with FinCEN to access Bank Secrecy Act (BSA) information, a critical element in the process of identifying illicit financial activity.
• Phase 3: Additional Federal and State Agency Access (Fall 2024) In Fall 2024, the third phase  broadens access further to include more Federal agencies and State, local, and Tribal law enforcement agencies. This will enhance the collective ability to detect and prevent financial crimes at various levels of government.
• Phase 4: Foreign Government Requests (Winter 2024) By Winter 2024, intermediary Federal agencies will be able to process requests from foreign governments, expanding the reach of this crucial transparency tool beyond U.S. borders.
• Phase 5: Financial Institutions (Spring 2025) The final phase, expected to begin in the spring of 2025, will allow financial institutions that are subject to customer due diligence requirements, as well as their supervisors, to request access to BOI. This marks a key step in ensuring that financial institutions can fully comply with regulations designed to combat illicit activity.

How Can Federal Agencies Request BOI?

For Federal agencies to access BOI, there are a few important steps to follow. As detailed in the updated FAQ, these agencies must first enter into a Memorandum of Understanding (MOU) with FinCEN. This MOU outlines how the agency will protect the security and confidentiality of the BOI it accesses. Agencies engaged in national security, intelligence, or law enforcement activities, along with regulatory agencies overseeing financial institutions, will be able to request access to BOI when they are eligible under the phased timeline.

Agencies that already have access to Bank Secrecy Act (BSA) data are permitted to request BOI directly through their agency coordinator. For agencies that have yet to become eligible, FinCEN encourages them to review the Beneficial Ownership Information Access and Safeguards Rule, which outlines the criteria and responsibilities associated with accessing BOI.

Ensuring Seamless Compliance with the Evolving BOI Access Process

As FinCEN continues to roll out access to Beneficial Ownership Information through its phased approach, the role of trusted partners like FinCEN Filing Agents becomes even more critical. With the ongoing updates to the FAQ and the eventual widespread availability of BOI, companies will need a reliable solution to navigate the complexities of compliance. FinCEN Filing Agents offers a streamlined, secure platform that ensures clients can stay ahead of these regulatory changes, simplifying the filing process while safeguarding sensitive data. As access to BOI expands, we remain committed to providing the support and expertise needed to help our clients manage these important compliance requirements with confidence and peace of mind.