ILLICIT CASH Act would hurt small-business owners, coalition says

November 13, 2019

Mark Schremmer


A coalition of 48 organizations, including the Owner-Operator Independent Drivers Association, is opposing a bill – the ILLICIT CASH Act – that it believes “would impose duplicative reporting burdens on millions of small businesses and threaten the privacy of law-abiding, legitimate small-business owners.”

The coalition on Wednesday, Nov. 13, sent a letter to the leaders of the Senate Committee on Banking, Housing and Urban Affairs to oppose S2563, the ILLICIT CASH Act. The legislation, which aims to improve corporate transparency and strengthen laws relating to money laundering, was introduced on Sept. 26 by Sen. Mark Warner, D-Va.

Currently, the “customer due diligence rule,” which was enacted in May 2018, requires financial institutions to collect the “beneficial ownership” information of business customers when they open accounts. As part of Warner’s bill, the reporting requirements would shift from large banks to millions of small businesses.

Coalition stance 

“While we support the goal of preventing wrongdoers from exploiting U.S. corporations and limited liability companies for criminal gain, the undersigned organizations write to express our strong opposition to Title IV of S2563,” the coalition wrote.

“The reporting requirements in the legislation would not only be duplicative, they would also be burdensome. Under this legislation, millions of small businesses would be required to register personally identifiable information with the Financial Crimes Enforcement Network, file updated reports within 90 days of any ownership changes, and file additional updated reports within a year of any ownership information changes, such as an expiration of a passport number or a change in address.”

According to the coalition, the ILLICIT CASH Act introduces significant privacy concerns as the proposed beneficial ownership database would contain the full legal names, dates of birth, addresses, and driver’s license or passport numbers of millions of small-business owners.

“Under the legislation, the Financial Crimes Enforcement Network would maintain a database of small-business owners’ personally identifiable information that could be hacked for nefarious reasons,” the coalition wrote.

“This risk is particularly acute because the ILLICIT CASH Act is focused only on small businesses, and those entities are often the least equipped to fight off cyber intrusions.”

Coalition members opposing the ILLICIT CASH Act

  • Air Conditioning Contractors of America.
  • American Farm Bureau Federation.
  • American Foundry Society.
  • American Hotel and Lodging Association.
  • American Rental Association.
  • Associated Builders and Contractors.
  • Associated Equipment Distributors.
  • Associated General Contractors of America.
  • Auto Care Association.
  • Construction Industry Round Table.
  • Foodservice Equipment Distributors Association.
  • Heating Air-conditioning and Refrigeration Distributors International.
  • Independent Electrical Contractors.
  • International Council of Shopping Centers.
  • International Franchise Association.
  • Manufacturer and Business Association.
  • Material Handling Equipment Distributors Association.
  • National Apartment Association.
  • National Association for the Self Employed.
  • National Association for Home Builders.
  • National Association of the Remodeling Industry
  • National Association of Wholesaler-Distributors.
    National Community Pharmacists Association.
  • National Electrical Contractors Association.
  • National Fastener Distributors Association.
  • National Grocers Association.
  • National Lumber and Building Material Dealers Association.
  • National Pest Management Association.
  • National Restaurant Association.
  • National Retail Federation.
  • National Roofing Contractors Association.
  • National Small Business Association.
  • NFIB.
  • North American Association of Food Equipment Manufacturers.
  • Owner-Operator Independent Drivers Association.
  • Petroleum Equipment Institute.
  • Petroleum Marketers Association of America.
  • Plumbing-Heating-Cooling Contractors Association.
  • Policy and Taxation Group.
  • Pool and Hot Tub Alliance.
  • Precision Metalforming Association.
  • The Real Estate Roundtable.
  • S Corporation Association.
  • Selected Independent Funeral Homes.
  • Service Station Dealers of America and Allied Trades.
  • Small Business and Entrepreneurship Council.
  • Specialty Equipment Market Association.
  • Tire Industry Association.
Mark Schremmer

Mark Schremmer, senior editor, joined Land Line in 2015. An award-winning journalist and former assistant news editor at The Topeka Capital-Journal, he brings fresh ideas, solid reporting skills, and more than two decades of journalism experience to our staff.