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Federal Register / Vol. 86, No. 233 / Wednesday, December 8, 2021 / Proposed Rules indicates that FinCEN has authority to collect a scanned copy of an identification document, along with the documents number, in prescribing reporting procedures and standards.
Therefore, the proposed rule specifies that the reporting company provide a scanned copy of the identification document from which the unique identifying number of the beneficial owner or company applicant is obtained, in connection with reporting that unique number.
FinCEN believes that the collection of an image would significantly contribute to the creation of a highly useful database for law enforcement and other authorized users. The image submitted by a reporting company in connection with a specific beneficial owner or company applicant could help to confirm the accuracy of the reported unique identification number because the image would contain the number.
FinCEN also believes this requirement would make it more difficult to provide false identification information because it is likely to be significantly more difficult to falsify an image of an identification document than to report an inaccurate number. The image may also assist law enforcement in identifying an individual because it would contain a picture of the individual associated with the identifying number, providing further confirmation of the individuals identity. While such pictures may already be available to law enforcement from existing records associated with the reported identification numbers, it would be highly useful for law enforcement to obtain such information from a centralized BOI database than to obtain the identification number from the BOI database and the picture from a different source. FinCEN considered that, as noted by several commenters, requiring an image may impose some additional burdens on reporting companies e.g., gathering and submitting images of the identification documents for each beneficial owner and company applicant. FinCEN
anticipates, however, that the burdens should be minimal because requesting a copy of an individuals identification document appears routine e.g., to verify an employees immigration status, and technological advances have made it relatively easy for individuals to provide scanned images. FinCEN
welcomes comments on the proposed collection of a scanned copy of an identification document. FinCEN
recognizes that several commenters encouraged FinCEN to require reporting companies to report significantly more
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information on each beneficial owner than is required by statute. For example, various commenters suggested FinCEN
should require reporting of whether a beneficial owner fell under the ownership interests or substantial control components of the definition of beneficial owner, precise reporting of ownership interest percentages, whether ownership interests are held directly or indirectly, and other types of information. Such additional information might enhance the utility of the database to authorized users.
FinCEN welcomes further comments on the statutory authority for and practical effect of requiring additional information to be reported.
Proposed 31 CFR 1010.380b2
would permit a reporting company to report the Taxpayer Identification Number 97 TIN of its beneficial owners and company applicants on a voluntary basis, solely with the prior consent of each individual whose TIN would be reported and with such consent to be recorded on a form that FinCEN will provide. While the statute requires reporting companies to provide certain specified information, it does not prohibit reporting companies from providing additional information on a voluntary basis. FinCEN has proposed this voluntary reporting option because such information would help ensure that the database of beneficial ownership information is highly useful for authorized users, in furtherance of the CTAs purpose and mandate. For example, having access to a TIN will allow authorized users such as FinCEN, law enforcement, investigators, and financial institutions to cross-reference other databases and more easily verify the information of an individual.
FinCEN believes that the inclusion of TIN reporting, even if voluntary, may help to raise standards for due diligence and transparency expectations for financial institutions and other governments. FinCEN is particularly interested in comments on this proposal to provide a voluntary mechanism to report beneficial owner and company applicant TINs.
ii. Information To Be Reported on Reporting Companies Proposed 31 CFR 1010.380b1i would require reporting companies to 97 A TIN is an identification number used by the Internal Revenue Service IRS in the administration of tax laws and assists in identifying entities and individuals and distinguishing them from one another. See IRS, Taxpayer Identification Numbers TINs, available at https www.irs.gov/
individuals/international-taxpayers/taxpayeridentification-numbers-tin. A TIN is unique to an entity or individual.

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report certain information to identify the reporting company. While the CTA
specifies the information required to be reported to identify each beneficial owner of the applicable reporting company and each applicant with respect to that reporting company, the CTA does not specify what, if any, information a reporting company must report about itself.98 However, the CTAs express requirement to identify beneficial owners and applicants for each reporting company clearly implies a requirement to identify the associated company. That implicit requirement is confirmed by the structure and overriding objective of the CTA, which is to identify the individuals who own, control, and register each particular entity, as well as by the CTAs direction to ensure that information is collected in a form and manner that is highly useful. 99 Without identifying information about the reporting company itself, FinCEN would have no ability to determine the entity that is associated with each reported beneficial owner or company applicant. For example, an investigator could not determine what entities a known drug trafficker uses to launder money.
Conversely, an investigator also could not determine who owns or controls an entity it knows is being used to launder money. This would frustrate Congresss express purposes in enacting the CTA
and would amount to an absurd result.100
Therefore, to ensure that each reporting company can be identified, the proposed regulations would require each reporting company to report its name, any alternative names through which the company is engaging in business d/b/a names, its business street address, its jurisdiction of formation or registration, as well as a unique identification number.
FinCEN believes that a company name alone may not be sufficient 98 31

U.S.C. 5336b2A.
Section 6402. See also 31 U.S.C.
5336b1FivI, b4Bii, d23.
100 See, e.g., Griffin v. Oceanic Contractors, Inc., 458 U.S. 564, 575 1982 noting that interpretations of a statute which would produce absurd results are to be avoided if alternative interpretations consistent with the legislative purpose are available; Arkansas Dairy Co-op Assn, Inc. v. Dept of Agr., 573 F.3d 815, 829 D.C.
Cir. 2009 rejecting a reading of a statute that would produce a glaring loophole in Congresss instruction to an agency; Assn of Admin. L. Judges v. FLRA, 397 F.3d 957, 962 D.C. Cir. 2005 Unless it has been extraordinarily rigid in expressing itself to the contrary . . . the Congress is always presumed to intend that pointless expenditures of effort be avoided. cleaned up; Pub. Citizen v.
Young, 831 F.2d 1108, 1112 D.C. Cir. 1987
explaining that a court must look beyond the words to the purpose of the act where its literal terms lead to absurd or futile results cleaned up.
99 CTA,
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