"Unintended Consequences: Small Businesses Caught in the Crosshairs of New Corporate Transparency Laws"
Small businesses are now required to disclose ownership information under a new anti-money laundering law, but investment vehicles like venture capital funds and private equity funds are exempt from the same rules after heavy lobbying. The exemption has been criticized for undermining anti-corruption and counterterrorism efforts. The Treasury Department's final rules extended the exemption to subsidiaries of banks, venture capital funds, and investment companies. While some hail the Corporate Transparency Act as a crucial anti-money laundering law, others argue that the exemption for investment vehicles poses a high risk of money laundering and terrorist financing. Some states are now taking steps to address private investment transparency, and the Treasury Department plans to release new anti-money laundering safeguards.