US companies no longer need to reveal true controllers after deregulation

Millions of American companies are now exempt from revealing who truly controls them, following a regulatory change that took effect on August 11. These businesses are no longer obligated to report the identity of their beneficial owners to the Financial Crimes Enforcement Network (FinCEN), the U.S. entity tasked with combating economic crime.

This move aligns with the White House's broader deregulation agenda, marking a significant departure from the stricter transparency requirements seen in Europe. The obligation to report beneficial ownership was initially established under the Biden administration in 2021 and had been in effect since early 2024.

The removal of this disclosure requirement is expected to create challenges for financial institutions, including Swiss banks. These banks rely on such information to identify the ultimate beneficial owners of assets entrusted to them, a crucial step in anti-money laundering and counter-terrorism financing efforts.

Beneficial owners are defined as individuals who own at least 25% of a company's shares or exert substantial influence over its operations. The rollback of this transparency measure raises concerns about potential implications for financial crime prevention and international regulatory cooperation.