Page 7 - January 16, 2025 Bulletin

aRTiCLeS

FinCEN Beneficial Ownership Fed’s Barr to Step Down as Vice
Registry Deadline Paused Again Chairman for Supervision

The January deadline for covered businesses to register their Federal Reserve Vice Chairman for Supervision Michael Barr
beneficial ownership information is once again on hold following announced he will step down from his position on Feb. 28 or at an
a Dec. 26 order from the Fifth Circuit Court of Appeals. The earlier date if a successor is confirmed. He will continue to serve as a
U.S. government has applied to the Supreme Court for a stay member of the Fed board, with his term ending in 2032.
of the injunction, requesting it be lifted entirely, or in the Barr has served as vice chair for supervision since 2022. In his current
alternative, limited only to the plaintiffs in the case.
role, Barr has led the interagency effort to draft and adopt the Basel
According to an updated Jan. 2 statement from the Financial III endgame capital requirements. He outlined a series of sweeping
Crimes Enforcement Network: “In light of a recent federal changes to the proposal in September after the original draft was
court order, reporting companies are not currently required to heavily criticized by a wide range of interests, from banks to housing
file beneficial ownership information with FinCEN and are not advocates. Regulators are still deliberating on the revised proposal.
subject to liability if they fail to do so while the order remains in The Fed does not plan to take up any major rulemakings until a vice
force. However, reporting companies may continue to voluntarily chair for supervision successor is confirmed.
submit beneficial ownership information reports.”
On Dec. 23, the Fifth Circuit lifted a nationwide injunction CFPB Finalizes Rule Removing
issued by the district court judge earlier this month in a Texas Medical Bills from Credit Reports
lawsuit challenging the Corporate Transparency Act, which
requires covered businesses to report their beneficial ownership The CFPB has finalized a rule removing medical debt and medical
information to FinCEN. In response to the Fifth Circuit bills from credit reports. The rule also prohibits lenders from
effectively reinstating the requirement to file, FinCEN delayed considering medical information when making lending decisions.
to Jan. 13 the deadline for most businesses to file their initial
beneficial ownership information. Businesses created or registered In 2003, Congress restricted lenders from obtaining or using medical
on or after Dec. 3, 2025, were provided an additional 21 days information, including information about medical debts, but gave
from their deadline to file. Deadlines for companies created or regulators the authority to issue a rule to protect lenders’ legitimate
registered on or after Jan. 1, 2025, were unchanged, with only 30 risk, consumer, and other needs. Federal regulators subsequently
days to file. issued a rulemaking to protect lenders’ ability to use medical debts in
their credit decisions pursuant to Regulation V, which implements
Three days later, “in order to preserve the constitutional status the Fair Credit Reporting Act, or FCRA. The CFPB’s new rule
quo while the merits panel considers the parties’ weighty amends Regulation V to remove that protection.
substantive arguments,” the panel of Fifth Circuit judges that will
consider the merits of the government’s appeal of the preliminary Read more: https://www.consumerfinance.gov/rules-policy/final-
injunction vacated that decision and once again enjoined rules/prohibition-on-creditors-and-consumer-reporting-agencies-
enforcement of the reporting rule and CTA. In response, concerning-medical-information-regulation-v/
FinCEN updated their website and removed the language
delaying the deadlines to report, and instead informing reporting
companies they could report on a voluntary basis, but were not
required to do so.
The lawsuit in Texas was filed by the National Federation of
Independent Business and several of its members. The plaintiffs
argued that the CTA exceeded Congress’ authority to regulate
interstate commerce, that it violates the First Amendment by
compelling speech and infringing freedom of association and that
it violates the Fourth Amendment by forcing the disclosure of
private information.
Bankers should monitor FinCEN’s BOI page for updates and
revised instructions, at: https://fincen.gov/boi

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