TheCorporateCounsel.net

We’ve previously blogged about the Corporate Transparency Act, which requires non-exempt entities to disclose information about their beneficial owners to FinCEN.  Well, the New York LLC Transparency Act, which is currently awaiting Gov. Hochul’s signature, could impose beneficial ownership disclosure obligations that go beyond those contemplated by the CTA. This excerpt from a BakerHostetler memo explains:

If it becomes law, the NYTA will require all LLCs formed or registered to do business in New York to disclose to the New York Department of State the same beneficial ownership information that such LLCs will need to disclose to the Financial Crimes Enforcement Network (FinCEN) under the CTA.

While both pieces of legislation have similar goals and impose similar disclosure obligations, they differ drastically in terms of the use and availability of the information submitted. Under the CTA, the beneficial ownership database is kept confidential and may be accessed only by law enforcement agencies and financial institutions in limited circumstances. But under the NYTA, the names and business addresses of the beneficial owners of LLCs will be made publicly available in a searchable database.

The New York Legislature passed this bill in June, and it’s been waiting on the Governor’s desk since then.  The memo says that it is unclear whether she will sign it, but that if she vetoes it, the Legislature can override that action by a 2/3rds vote of both houses.

– John Jenkins