Poll responses cite growing awareness of beneficial ownership reporting rule
Small businesses, legal and compliance professionals across the U.S. are increasing their readiness levels, albeit slightly, to comply with new beneficial ownershipreporting requirements, according to the results of a recent poll by Wolters Kluwer CT Corporation.
When asked about their level of preparedness for meeting the new reporting rule, which took effect January 1 as part of the Corporate Transparency Act (CTA), respondents are trending toward greater compliance, improving eight points compared to the company’s November 2023 webinar poll. The new rule represents one of the most significant regulatory changes to broadly impact American business since passage of the Securities Act in 1933 in the wake of the U.S. stock market crash.
Twenty-six percent of those surveyed characterized their organizations’ readiness as between 75% to 100% in the January poll. The same question, posed during a Wolters Kluwer beneficial ownership webinar on November 15, 2023, indicated a level of just 18% readiness among 4,200 attendees.
The results reflect responses from more than 5,100 attendees and those surveyed during a January 2024 beneficial ownership webinar conducted by the company.
“There is a noticeable uptick in the market, not only in terms of greater awareness but also in preparations among those who realize they are subject to the beneficial ownership reporting requirements,” said Rupak Venugopal, Vice President, Beneficial Ownership, for Wolters Kluwer’s Financial & Corporate Compliance division. “But despite this upward trend, there remains a considerable lack of awareness among impacted businesses, and we are working diligently to help change that dynamic through a growing ecosystem of partnerships that can provide secure and trustworthy resources to comply.”
The company recently launched a Beneficial Ownership Platform solution to simplify filing and ongoing compliance for both single-entity as well as multiple-entity filers.
Polling reflects responses from more than 5,100 attendees and those surveyed during Wolters Kluwer’s January 23, 2024 beneficial ownership webinar.
The prevalence of respondents who indicated a total lack of preparedness dropped seven points, from 38% in November’s webinar to 31% in January’s poll. Both polls, however, show substantial increases in readiness levels compared to a Wolters Kluwer survey from mid-2023, when 74% of respondents representing companies potentially subject to the reporting requirement indicated they had only become aware of the rule “by having taken the survey.”
The U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) estimates that the rule will impact approximately 32.6 million reporting companies in 2024 alone, withfive million new reporting companies formed and registered every year going forward. There are significant consequences for non-compliance, including fines of up to $10,000 and possible incarceration.
More information is available on the dedicated Wolters Kluwer resources page, “Beneficial Ownership Information Compliance from CT Corporation.”