CTA Update: FinCEN Suspends Penalties and Announces Intention to Further Extend Deadline for Reporting Entities Beyond March 21, 2025
Client Alert | February 28, 2025
On February 27, 2025, the Financial Crimes Enforcement Network (FinCEN) issued guidance announcing that it will not issue fines or penalties to, or take any enforcement action against, entities that fail to file or update beneficial ownership information (BOI) reports pursuant to the Corporate Transparency Act (CTA) by the current deadline, which for most reporting entities is March 21, 2025.[1] FinCEN also announced that it intends to issue an interim final rule by March 21, 2025 to formally extend the reporting deadline. “[L]ater this year,” FinCEN plans to issue a notice of proposed rulemaking and solicit public comment on a new rule permanently revising the existing BOI reporting requirements.
Entities that may be subject to the CTA and its associated Reporting Rule that have not filed BOI reports should consult with their CTA advisors as necessary, now that FinCEN has suspended enforcement of the filing deadlines.
Prior to yesterday’s announcement, and after litigation that temporarily enjoined enforcement of the CTA from December 2024 until February 18, 2025, FinCEN had issued guidance extending the reporting deadline to March 21, 2025 or later.[2] In that same guidance, FinCEN previewed that it intended to take further steps to modify deadlines. On February 27, 2025, FinCEN issued the additional guidance described above, which has the effect of suspending the March 21, 2025 deadline.[3] Instead, FinCEN intends to issue an interim final rule before March 21, 2025, extending BOI reporting deadlines.[4]
FinCEN also announced it will issue a notice of proposed rulemaking, anticipated to be issued later this year, to adopt permanent changes to the reporting requirements to minimize the burden on small businesses while ensuring that BOI is highly useful to important national security, intelligence, and law enforcement activities.[5] As part of that rulemaking, FinCEN may also further modify applicable deadlines, and the agency intends to solicit public comment on potential revisions to existing reporting requirements.[6] The public comment period will be an important opportunity for companies to provide input to FinCEN and build a record supporting changes to the existing reporting requirements, including the burden the requirements impose on businesses, and will allow companies to preserve and highlight for FinCEN any potential legal challenges to the new proposed reporting requirements.
For additional background information, please refer to our Client Alerts issued on December 5, December 9, December 16, December 24, and December 27, 2024, January 24, 2025 and February 19, 2025.
[1] https://www.fincen.gov/news/news-releases/fincen-not-issuing-fines-or-penalties-connection-beneficial-ownership.
[2] https://fincen.gov/sites/default/files/shared/FinCEN-BOI-Notice-Deadline-Extension-508FINAL.pdf.
[3] https://www.fincen.gov/news/news-releases/fincen-not-issuing-fines-or-penalties-connection-beneficial-ownership.
[4] Id.
[5] Id.
[6] Id.
Gibson Dunn has deep experience with issues relating to the Bank Secrecy Act, the Corporate Transparency Act, other AML and sanctions laws and regulations, and challenges to Congressional statutes and administrative regulations.
For assistance navigating white collar or regulatory enforcement issues, please contact the authors, the Gibson Dunn lawyer with whom you usually work, or any leader or member of the firm’s Anti-Money Laundering, Administrative Law & Regulatory, Investment Funds, Real Estate, or White Collar Defense & Investigations practice groups.
Please also feel free to contact any of the following practice group leaders and members and key CTA contacts:
Anti-Money Laundering:
Stephanie Brooker – Washington, D.C. (+1 202.887.3502, sbrooker@gibsondunn.com)
M. Kendall Day – Washington, D.C. (+1 202.955.8220, kday@gibsondunn.com)
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Ella Capone – Washington, D.C. (+1 202.887.3511, ecapone@gibsondunn.com)
Sam Raymond – New York (+1 212.351.2499, sraymond@gibsondunn.com)
Administrative Law and Regulatory:
Stuart F. Delery – Washington, D.C. (+1 202.955.8515, sdelery@gibsondunn.com)
Eugene Scalia – Washington, D.C. (+1 202.955.8673, dforrester@gibsondunn.com)
Helgi C. Walker – Washington, D.C. (+1 202.887.3599, hwalker@gibsondunn.com)
Matt Gregory – Washington, D.C. (+1 202.887.3635, mgregory@gibsondunn.com)
Investment Funds:
Kevin Bettsteller – Los Angeles (+1 310.552.8566, kbettsteller@gibsondunn.com)
Shannon Errico – New York (+1 212.351.2448, serrico@gibsondunn.com)
Greg Merz – Washington, D.C. (+1 202.887.3637, gmerz@gibsondunn.com)
Real Estate:
Eric M. Feuerstein – New York (+1 212.351.2323, efeuerstein@gibsondunn.com)
Jesse Sharf – Los Angeles (+1 310.552.8512, jsharf@gibsondunn.com)
Lesley V. Davis – Orange County (+1 949.451.3848, ldavis@gibsondunn.com)
Anna Korbakis – Orange County (+1 949.451.3808, akorbakis@gibsondunn.com)
White Collar Defense and Investigations:
Stephanie Brooker – Washington, D.C. (+1 202.887.3502, sbrooker@gibsondunn.com)
Winston Y. Chan – San Francisco (+1 415.393.8362, wchan@gibsondunn.com)
Nicola T. Hanna – Los Angeles (+1 213.229.7269, nhanna@gibsondunn.com)
F. Joseph Warin – Washington, D.C. (+1 202.887.3609, fwarin@gibsondunn.com)
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