100,000 firms positively respond to Yellen’s war against dirty money

Treasury Secretary Janet Yellen has announced that 100,000 businesses have joined a new database that collects “beneficial ownership” information on firms as part of a government effort to unmask shell company owners.

The database will support law enforcement in making arrests, prosecuting offenders, and seizing ill-gotten assets. The bipartisan Corporate Transparency Act, signed into law in 2021, gives Treasury the authority to write new rules on beneficial ownership.

As of January 1, most US firms must report identifying information about who directly or indirectly owns or controls them. The National Small Business Association sued Treasury over the database, arguing it violates the U.S. Constitution, privacy, and free speech protections.

A judge is expected to decide on the matter imminently. Treasury is also considering additional steps to address risks associated with commercial real estate, which is a commonly used vehicle for money laundering.