Scams Arise with Beneficial Ownership Information Reporting

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FinCEN requires Beneficial Ownership Information

The Corporate Transparency Act and BOI Reporting Leads to New Scams

AJM&A has issued many notices about completing your company’s or trusts’ Beneficial Ownership Information (BOI) report . Sadly, recent data shows that the confusion around the reporting process has led to new scams targeting small businesses trying to comply with the Corporate Transparency Act (CTA).

Many small businesses owners have never heard of the CTA and are not completely sure how to comply with their reporting request. The CTA requires that most small-business owners provide their BOI to the Financial Crimes Enforcement Network (FinCEN) by the end of 2024. Failure to comply can result in potential fines and imprisonment.

The reporting confusion has led to new opportunities for harassing scammers to target business owners. Among the most pervasive scams are:

  • Filing company scams — Fake companies can position themselves as intermediaries to file the form at a cost to the business owner. These bogus intermediary companies not only get the initial fee but can sell personally identifying information on the black market
  • False websites — Bad players set up websites that impersonate FinCEN, often copying even the stamps and logo. This gives the scammers access to businesses’ information.
  • Threatening letters & emails — Letters or emails are sent out claiming to be from FinCEN or a fake government agency associated with FinCEN. These communications are often very threatening, and some of the more sophisticated letters use QR Codes that are a misdirection and can result in information being shared.
  • Phone scams — Phone calls offering business help to file over the phone. The calls range from friendly reminders to threats of enforcement and, if successful, usually end with individuals’ information on the black market.

Small businesses must now be more discerning about the notices they receive. Unfortunately, little can be done to intercept the scams. Clearly the burden for avoiding them and complying with legitimate filing rules will fall on the business owners themselves. We are registered agents for our clients and have filed many BOI reports this year. If you need help or advice with BOI reporting, contact our office.