FinCEN Update: No Register. Still an Obligation.
On 11 August 2026, the U.S. Treasury made one of the biggest changes to corporate transparency in recent years. FinCEN issued a final rule that permanently removed the requirement for U.S. companies and U.S. persons to report beneficial ownership information under the Corporate Transparency Act. It also announced that it will delete beneficial ownership information previously submitted by U.S. persons. Foreign companies that register to do business in the U.S. remain subject to reporting requirements.
Whilst many commentators have rightly framed this as the end of the U.S. beneficial ownership register, I believe it is not the most important consequence. The real question becomes: Who now carries the burden of finding the real owner of a U.S. company? As a compliance professional, the answer is simple. The onus now rests solely on the financial service providers. Banks, Investment firms, Law firms, Accountants, High-value service providers. Essentially, anyone subject to anti-money laundering reporting obligations. The rollback does not remove the need to identify beneficial owners. It simply removes one source of information. For U.S. firms obligated to carry out customer due diligence, this distinction matters.
Under the Financial Action Task Force (FATF) standards, countries should ensure that competent authorities can obtain adequate, accurate and up-to-date beneficial ownership information. This expectation sits at the heart of FATF Recommendation 24, which promotes transparency over the ownership of legal persons. While FATF standards are not binding law, the U.S. has committed to them as a FATF member and is assessed against them during Mutual Evaluations.
On my side of the pond, one could say the direction of travel is different. The European Union (EU) is preparing to implement the single rule book, Anti-Money Laundering Regulation (AMLR), which will apply from July 2027. Harmonising the the ultimate beneficial owner (UBO) threshold strictly at 25% or more across member states, under the AMLR firms will still need to identify the natural persons who ultimately own or control legal entities.
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Where the U.S. has reduced reporting obligations for domestic companies, the EU is increasing expectations on firms to verify ownership. That means cross-border compliance may become harder, not easier. This creates an interesting divide and grounds for future comparative studies in the months to come (stay tuned for my academic paper on this!).
Some might argue that removing the register reduces unnecessary costs for legitimate small businesses, which is a fair point. The U.S. Treasury has said the new rule reduces burdens on law-abiding business owners while maintaining national security objectives. However, compliance professionals should avoid one dangerous assumption. No register does not mean no obligation. If anything, firms should expect regulators to ask a different question: How did you satisfy yourself that you identified the true beneficial owner? Answering that question now requires compliance teams to gather much stronger evidence.
For many U.S. entities, firms may need to rely on corporate records, operating agreements, shareholder information, trust documents, public filings, commercial databases, open-source intelligence and direct engagement with the customer. Each source has strengths and weaknesses. Together, they create a more defensible due diligence file than relying on a single register.
It is my belief that the wider lesson goes beyond beneficial ownership. Financial crime compliance has never depended on a single register. A beneficial ownership register is one source of information, not the whole due diligence process. Effective compliance requires firms to gather evidence from multiple sources, verify ownership, assess risk, and question information that does not make sense. A register can support that work, but it cannot replace it. This week U.S. Treasury changed one part of the system, not the entirety of it.
My question to the compliance community is simple: Will FinCEN’s latest decision simply shift the compliance burden from government to the private sector, or does it create a wider gap in the global transparency framework?
