Beware of Scams Related to the Corporate Transparency Act

There has been a great deal written lately about the impact and filing requirements of the Corporate Transparency Act, which is a 2021 federal law aimed at detecting money laundering, terrorist finance and other illicit financial activity.  Community associations have been told they are not exempt, and their directors must comply with the Act’s new reporting requirements.

Given that these are completely new requirements that demand strict compliance by association directors with the submission of their information to the Department of the Treasury and the Financial Crimes Enforcement Network (FinCEN), there is a great deal of potential for abuse. Apparently, fraudsters have already taken notice, and according to FinCEN the scams have begun.

Corporate Transparency Act Schemes

The federal agency recently reported in an alert on its website that these fraudulent schemes may feature:

• Correspondence requesting payment. There is NO fee to file the required “Beneficial Ownership Information” directly with FinCEN. FinCEN does NOT send correspondence requesting payment to file BOI. Do not send money in response to any mailing that claims to be from FinCEN or another government agency.
• Correspondence that asks the recipient to click on a URL or to scan a QR code. Those e-mails or letters are fraudulent. Do not click any suspicious links or attachments or scan any QR codes in emails, on websites, or in any unsolicited mailings.
• Correspondence that references a “Form 4022” or an “Important Compliance Notice.” This correspondence is fraudulent. FinCEN does not have a “Form 4022.” Do not send BOI to anyone by completing these forms.
• Correspondence or other documents referencing a “US Business Regulations Dept.” This correspondence is fraudulent; there is no government entity by this name.

Navigating Corporate Transparency Act Scams & Filings

The federal agency encourages anyone who receives solicitations that they suspect are fraudulent to report them here to the Office of the Inspector General of the Treasury Department.

Association directors and property managers with questions regarding the filing requirements of the new Corporate Transparency Act should consult with qualified legal counsel. By working with experienced attorneys and alerting the federal government of any potential scams, community association directors and other BOI respondents will be able to avoid any missteps and fraud.

Our firm’s attorneys write regularly in this blog about important matters for association directors, property owners, and members of the real estate and construction industries, and we encourage industry followers to subscribe to our newsletter to receive all our future articles.