December 20, 2023

In This Issue:

  • Corporate Transparency Act: Are You Exempt?
  • Fannie Mae Updated Selling Guide Last Week Expanding Use of Attorney Opinion Letters
  • FinCEN Invites Nominations for Membership on the Bank Secrecy Act Advisory Group

Corporate Transparency Act: Are You Exempt?

Leslie S. Johnson, TLTA Board Member and Judiciary Committee Chair | Dec. 20, 2023
The 2021 Corporate Transparency Act (“CTA”) is new federal legislation that becomes effective January 1, 2024 and may require certain business entities operating in or around the title insurance industry to report personal information about their individual owners to the federal Financial Crimes Enforcement Network (“FinCEN”).

Specifically, the CTA requires a “Reporting Company” to provide (and update) personally identifying information about the company’s “Beneficial Owners” and potentially its “Company Applicant(s)” to FinCEN by certain dates.  Its purpose is to create a registry of beneficial ownership information that law enforcement and regulators can quickly and easily access in their fight against organized crime, money laundering, and bad actors hiding behind shell entities. 

The CTA defines a Reporting Company as a “corporation, limited liability company, or other similar entity that is “created by the filing of a document with a secretary of state or a similar office under the law of a State or Indian Tribe . . . .”  Therefore, filing entities may be Reporting Companies if they do not qualify for an exemption.  However, non-filing entities – such as common law trusts, general partnerships, and sole proprietorships – do not constitute Reporting Companies and do not need to file with FinCEN.

There are 23 exemptions to the definition of a Reporting Company, the most relevant to the title industry being exemptions for: (1) a publicly traded company; (2) an insurance company; (3) a state-licensed insurance producer; (4) a large operating company; and (5) a wholly-owned subsidiary of those exempt entities. 
 
Read more »
 
TLTA Editor's Note: The U.S. House passed HR 5119 last week, which would substantially expand the deadline for existing companies to 2 years, and 90 days for all new companies (no drop off in 2025).  If approved by the Senate too, this legislation would also extend the deadline to report changes to 90 days. This legislation is currently pending in the Senate's Committee on Banking, Housing and Urban Affairs. 
 

Fannie Mae Updated Selling Guide Last Week Expanding Use of Attorney Opinion Letters

ALTA | Dec. 19, 2023
In another move that increases unnecessary risk to consumers and lenders, Fannie Mae updated its Selling Guide on Wednesday expanding the use of attorney opinion letters (AOLs) in limited circumstances for loans on condo properties and those subject to restrictive agreements or covenants.
 
Review Fannie's Selling Guide updates »
More on this development from ALTA »

FinCEN Invites Nominations for Membership on the Bank Secrecy Act Advisory Group

U.S. Treasury | Dec. 15, 2023
The Financial Crimes Enforcement Network (FinCEN) is inviting nominations for membership on the Bank Secrecy Act Advisory Group (BSAAG). BSAAG membership is open to financial institutions subject to the Bank Secrecy Act (BSA), trade groups with members that are subject to the BSA, and federal and non-federal regulators and law enforcement agencies that are located within the United States. Membership is granted to organizations, not to individuals. Organizational members will be selected to serve a three-year term. 
 
Nominations must be recevied by Jan. 16, 2024.
 
Learn more about the nomination process »