Starting a new business can be an exhilarating endeavor. But the federal government and the government of Texas constantly deal with people who are trying to commit money laundering. Criminals use fake corporations and limited liability companies to conceal money obtained from illicit or illegal activities. The Anti-Money Laundering Act (AMLA) of 2020 includes many reforms designed to help combat these financial crimes.
A larger act included the AMLA
The National Defense Authorization Act (NDAA) for Fiscal Year 2021 included the AMLA. The AMLA fit into the NDAA because the bill was intended to address money laundering used to commit terrorism.
The AMLA focuses on establishing beneficial owners
The term “beneficial owner” refers to the person who controls or owns the company. Establishing the true beneficial owner is important to money laundering prevention because criminals will open accounts under false names while still benefitting financially. This aspect of business law in the AMLA requires banks and other financial companies to establish and report the identities of their beneficial owners during the opening of a new account. The financial institutions must disclose the following information about beneficial owners:
- Full names
- Identifying numbers
The AMLA extends the Bank Secrecy Act’s reach
First launched in 1970, the Bank Secrecy Act (BSA) was the first federal law to fight against money laundering. The AMLA extended its reach to include antiquity dealers and digital currency. Through the AMLA, federal agencies received encouragement to investigate art trading and the ways money laundering is achieved through art dealers.
The AMLA focuses on penalties and greater protections against money laundering
The federal government designed the AMLA to extend the reach of its ability to detect money laundering. If you own an limited liability company or a corporation, the AMLA affects how you conduct your business in order to remain compliant with federal law.