More on the Corpoorate Transparency Act

So... I reported our board's information a few days ago. Took less than half an hour, sent the transcript and acknowledgement email to the other directors and the community manager, and then I deleted the other directors' confidential info from my computer. (Liability, y'all.) I also watched another webinar that was put on by a management company in my state.

Things I've learned:

* I have taken on some liability risk as the person who filed the information. Possible examples: another board member provides bad info, or I didn't remove the others' personal info from my computer and it's hacked.

* The lawyer/presenter talked about the risk to the corporation and to the other directors if a board member refuses to provide their info. One suggestion: the board should consider amending their bylaws to: 1) require elected directors to provide this information as a condition of service; 2) allow other board members to remove a non-compliant director. Number 2 would be similar to a board member not attending board meetings - failure to attend or to comply with the CTA requirements is considered a resignation.

(Question: even if an association's bylaws requires membership approval of amendments, would this be another example of an amendment only requiring board approval since the sole purpose of the amendment is bringing the bylaws into compliance with federal law?)

* In associations where board members aren't getting along and won't give each other personal info - that never happens, right? - they will probably need to use a third-party to submit this information. Third parties include the association's manager, the attorney, or another company offering this service. The presenter said that the cost is pretty minimal unless the attorney does it.

* Yes, a lot of the association's hired contractors are also corporations that must file their info. No, the association is unlikely to be liable if a contractor does not file. Note: "unlikely" does not equal "certainly not".

* If a director provides his driver's license info as his beneficial owner info and his passport expires, does the expired passport require an update to the beneficial owner info or not? (This was not clear.) What happens if I have a nose job and dye my hair bright blue? :-)

* The presenter was incorrect when he said that the government's sharing of this personal info would be "very limited". He mentioned banks and entities of that sort. He said no to the IRS - but isn't one of the purposes of the CTA to go after tax evaders? He also specifically did not mention law enforcement in this country and in other counties. This last one is the part that concerns many people. Color me skeptical (along with my blue hair).

* The presenter also discussed the association and/or individual board members filing lawsuits against a non-compliant director whose actions led to fines for the association. Said fines would not be covered by insurance since they resulted from non-compliance with federal law.

Anyone else want to claim that the CTA is "no big deal"?

The actual filing time is a tiny fraction of the time that went into knowing enough to understand what I was filing.

I also firmly believe than when legal matters, the feds, and potential fines and prison sentences collide, sound bytes are insufficient. My issues with the CTA have never been with the administrative burden, which should be minor even in my community with its Revolving Door board. My issues have always been with the legal implications of the law. I am alarmed and outraged by them.

The fact that there may be bigger fish to fry doesn't mean that this particular fish should be ignored. Any fish that stinks needs attention.

I truly hope that this will be a one-and-done (*) and that CAI's lawsuit is ultimately successful.

(* Our annual meeting is in the first quarter, so it's very likely that we'll have to file at least one more time. I doubt that the lawsuit will be settled prior to then, although CAI filed in Virginia because that court regularly handles challenges to federal law and moves quickly.)

The sad thing is that nobody is disagreeing about the need to fight terrorism and money laundering. But you have to look in the right places. Community associations are not shadow corporations. Time wasted looking at them is time not spent looking in places where the bad guys may actually be.