ABA Opposes Treasury Proposals Requiring Law Firms Establishing Accounts at Financial Institutions to Disclose Identity and Other Beneficial Ownership of Clients

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Wednesday, August 3, 2016
Bruce Zagaris
                On May 4, 2012, Kevin L. Shepherd, Esq., a partner in the Baltimore office of Venable LLP, sent a letter on behalf of the American Bar Association to the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) concerning customer due diligence requirements for financial institutions.  The letter states that the ABA opposes those proposals contained in the Advanced Notice of Proposed Rulemaking (ANPR) – Customer Due Diligence Requirements for Financial Institutions[1] “that would require law firms that establish accounts at financial institutions on behalf of their clients to disclose the identity and other beneficial ownership in formation regarding those clients.  If adopted in their current form, those proposals could impose unreasonable and excessive burdens on many law firms with client trust accounts and could undermine both the confidential lawyer-client relationship and traditional state court regulation of lawyers.”  As a result, the ABA urges FinCEN not to proceed with those proposals in the Notice.