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ARTICLE · 10 MAY 2024

FinCEN Issues Proposed Rule To Implement AML Reporting Requirements For Real Estate Sector

McDermott Will & Schulte
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On Feb. 16, 2024, the Financial Crimes Enforcement Network ("FinCEN"), a bureau of the United States Department of the Treasury ("Treasury"), issued a notice of proposed rulemaking ("Proposed Rule")...

United StatesReal Estate and Construction
Betty Santangelo
Betty Santangelo
Melissa G.R. Goldstein
Melissa G.R. Goldstein
Julian M. Wise
Julian M. Wise
Kyle B. Hendrix
Kyle B. Hendrix
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On Feb. 16, 2024, the Financial Crimes Enforcement Network ("FinCEN"), a bureau of the United States Department of the Treasury ("Treasury"), issued a notice of proposed rulemaking ("Proposed Rule")1 continuing the process of implementing regulations to combat illicit finance risks posed by abuse by some in the real estate market. The Proposed Rule would require certain persons involved in residential real estate closings and settlements to submit reports ("Real Estate Reports") and keep accurate records of certain non-financed transfers of US residential real property. The reasoning behind the Proposed Rule is explained extensively in FinCEN's December 2021 Anti-Money Laundering Regulations for Real Estate Transactions Advanced Notice of Proposed Rulemaking, which discusses "the opacity of shell companies or other legal entity structures to mask true beneficial ownership of a property and their involvement in real estate transactions."2

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