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CathyA3 (Ohio)
Posts: 6,299
Posted:
A couple items arrived in my inbox recently.

One is from Community Associations Institute, and it is calling on members and others to learn more information about the Corporate Transparency Act and its impact on most community associations incorporated in the U.S. They are asking people to help educate Congress about the unintended consequences of this law and urge them to delay implementation and exempt community associations from the requirements.  Quote from the email:

The CAI Ohio Legislative Action Committee is meeting with Senator Sherrod Brown (D-OH) staff this afternoon to discuss the critical importance of S.3625 - Protect Small Business and Prevent Illicit Financial Activity Act - being heard by the Senate Banking Committee. We urge you to reach out to Senator Brown TODAY about this important bill!

CAI has taken the position that it does not believe the Anti-Money Laundering Act and Corporate Transparency Act are intended to apply to community associations. Among other things, the organization has requested delay of the implementation of the Beneficial Ownership Information (BOI) reporting requirements by having Senators co-sponsor S.3625 - Protect Small Business and Prevent Illicit Financial Activity Act (introduced by Senator Tim Scott (R-SC)), the Senate companion of H.R. 5119 – Protect Small Business and Prevent Illicit Financial Activity Act, which was approved by the House on 12/12/23 by a vote of 420-1.

The email also noted that after the passage of H.R. 5119, a group of more than 80 Senators and Representatives sent a letter to FINCEN urging a one-year delay of all reporting requirements under the Corporate Transparency Act.

The second item is a letter from Senator Sherrod Brown in the response to a letter I sent several months ago discussing the unintended consequences of the Corporate Transparency Act and urging Congress to delay implementation of the law until lawmakers can decide whether community association should be exempt from the reporting requirements.

His letter was a mixture of information and politicking (not surprising). He talked in general terms about his position as Chairman of the Senate Committee on Banking, Housing, and Urban Affairs, and he notes that The Committee has jurisdiction over a diverse set of issues, including banking, financial markets, monetary policy, housing, urban development, mass transit, and international trade.

No actionable information yet, unfortunately, but I hope people have gotten the attention of the right legislators who can at least clarify whether or not community associations should be subject to the reporting requirements of the Corporate Transparency Act. Time to be squeaky wheels.

KerryL1 (California)
Posts: 14,550
Posted:
Thanks so much for the update, Cathy.
TimB4 (Tennessee)
Posts: 21,059
Posted:
Bottom line - As it sits now, Associations are still required to report by Dec. 31, 2024 (and every year after) or face monetary penalties.
LoriM15 (Florida)
Posts: 1,009
Posted:
Our attorney is still telling us to wait until the last minute in case something changes.
BillD16 (Texas)
Posts: 971
Posted:
For what very little it is worth, I attended a webinar on CTA a month+ ago. It was sponsored by the company that runs the portal that our PMC insists that we use now (whose name I can’t say except that it reminds me of a breath mint).

The CEO ran the webinar (and was very good at it). The speaker was a fellow who literally wrote a book on the CTA (and who, coincidentally, runs a website that is designed to help HOA BOIs register properly with Our Friends in the Government). I can find his name if anyone wants it. I’m responding here just to say that I don’t know what will happen with CTA, but it sure seems like some people and businesses are putting time and money into getting ready for its arrival. It is impossible for me to judge whether this is a matter of “JIC” or “BOHICA”. But I got the definite impression that “my” portal company is poised and ready to team with the book fellow to offer CTA registration services as a new portal feature, when and if necessary.

Bill

HOA Board ex-President
Austin, Texas USA

“You can’t put too much water in a nuclear reactor”
CathyA3 (Ohio)
Posts: 6,299
Posted:
Bill,

If you're willing to share the name and other info, I'd be happy to have it. If people are putting resources into this, it sure sounds like they believe that the CTA isn't going anywhere. And probably it isn't for the larger corporations that the government intended to target. I still hope that catching community associations in their net wasn't their intention and that eventually we'll be exempted.

email addy: QUIZZIGAL13 "at" gmail
BillD16 (Texas)
Posts: 971
Posted:
Quote:
Posted By CathyA3 on 05/16/2024 9:14 AM
Bill,

If you're willing to share the name and other info, I'd be happy to have it. If people are putting resources into this, it sure sounds like they believe that the CTA isn't going anywhere. And probably it isn't for the larger corporations that the government intended to target. I still hope that catching community associations in their net wasn't their intention and that eventually we'll be exempted.

email addy: QUIZZIGAL13 "at" gmail

You've got mail!

Bill

HOA Board ex-President
Austin, Texas USA

“You can’t put too much water in a nuclear reactor”
KerryL1 (California)
Posts: 14,550
Posted:
What is "CTA?" Thanks.
CathyA3 (Ohio)
Posts: 6,299
Posted:
Corporate Transparency Act.

It was enacted by Congress on January 1, 2021, as part of the National Defense Authorization Act. The CTA includes significant reforms to anti-money laundering laws and is intended to help prevent and combat money laundering, terrorist financing, corruption, and tax fraud. The CTA establishes a beneficial ownership reporting requirement for corporations, limited liability companies, and other similar entities formed or registered to do business in the United States.

Beneficial ownership reports must be filed with the Financial Crimes Enforcement Network (FinCEN), a bureau within the U.S. Department of Treasury.

I've been looking over the info from the webinar Bill attended. There were some interesting tidbits in there, including a list of exempt reporting companies. Among others, these include:

* banks and credit unions
* securities brokers or dealers
* venture capital fund advise
* insurance companies
* accounting firms (*cough* Enron and Arthur Anderson *cough*)

Sure seems to me like these entities could provide ample cover for financial shenanigans of all sorts, including the ones that the CTA is supposed to disrupt. I thought from the start that the CTA's reporting requirements are just fishing expeditions that will net the small fry and not the big players that they want to go after. I'm totally on board with handing the government my personal information in furtherance of this goal.

(Yes, that was sarcasm.)
CathyA3 (Ohio)
Posts: 6,299
Posted:
Quote:
Posted By LoriM15 on 05/16/2024 7:32 AM
Our attorney is still telling us to wait until the last minute in case something changes.

Good advice. There is no benefit to filing early, and we have to re-file every time the composition of the board changes. Given that condo boards can be revolving doors, this could end up being time-consuming - and it's not like board members or community managers have time on their hands.
KerryL1 (California)
Posts: 14,550
Posted:
Thanks Cathy, my duh.

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