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Corporate Transparency Act Update

Client Alert

For a more detailed overview on the CTA, and the changes business owners should expect at the turn of the calendar, click here. A webinar providing further explanation can be viewed here, which was presented December 7.

The Corporate Transparency Act (“CTA”), with an effective date of January 1, 2024, is set to impose strict reporting guidelines on business owners throughout the country.  The below provides a brief update on two aspects of the CTA ahead of its effectiveness next week.

Access and Safeguards Final Rule

On December 21, 2023, the Financial Crimes Enforcement Network issued the final rule setting forth the access and security guidelines (the “Access Guidelines”) related to the CTA.

The Access Guidelines detail six categories of authorized recipients who may access the beneficial ownership reporting information reported by business owners pursuant to the CTA (collectively, “BOI”): (i) federal agencies engaged in national security, intelligence, or law enforcement activity; (ii) state law enforcement agencies; (iii) foreign law enforcement agencies; (iv) financial institutions facilitating compliance with customer due diligence requirements under applicable law; (v) federal functional regulators assisting financial institutions under (iv) above; and (vi) Department of Treasury officers and employees.

Even if an agency is an “authorized recipient” under the Access Guidelines, that agency must satisfy several security and confidentiality requirements to ensure the proper protection of BOI after its receipt.  These recipient agencies are then further prohibited from re-disclosing BOI, unless one of eight enumerated circumstances is present.  Disclosure in violation of the Access Guidelines carries civil penalties in the amount of $500 for each day a violation continues or has not been remedied, and criminal penalties of not more $250,000 or imprisonment for not more than 5 years, or both.

Trend Amongst Service Professionals

Throughout the rulemaking process, it has become clear that the varying levels of analysis required for a given business’ compliance with the CTA is the “practice of law.”  Ohio Revised Code § 4705.07(A)(3) prohibits any person who is not licensed to practice law in the State of Ohio from committing any act that is deemed to be the practice of law.  Actions in contravention of R.C. § 4705.07 carry steep civil penalties.

Recognizing the legal components of the CTA, numerous professional associations throughout the country, including the American Institute of Certified Public Accountants, the Ohio Society of CPAs, and the BDO Alliance USA, have advised their membership to consider speaking with legal counsel for their liability risks associated with CTA reporting.

Service providers should direct their clients to consult with an attorney concerning their reporting obligations under the CTA to avoid any liability for the unauthorized practice of law.

For questions regarding the CTA and how your business should prepare for the new mandatory reporting, please do not hesitate to contact BMD Member Blake Gerney (brgerney@bmdllc.com) or BMD Attorney Jacob Davis (jrdavis@bmdllc.com).

 


The Ohio State University Launches Its Accelerated Bachelor of Science in Nursing Program

In response to Ohio’s nursing shortage, The Ohio State University College of Nursing is accepting applications for its new Accelerated Bachelor of Science in Nursing program (aBSN). Created for students with a bachelor’s degree in non-nursing fields, the aBSN allows such students to obtain their nursing degree within 18 months. All aBSN students will participate in high-quality coursework and gain valuable clinical experience. Upon completion of the program, graduates will be eligible to take the State Board, National Council of Licensure Exam for Registered Nursing (NCLEX-RN).

Another Transparency Obligation: The FinCEN Beneficial Ownership Information Reporting Requirements

Many physician practices and healthcare businesses are facing a new set of federal transparency requirements that require action now. The U.S. Department of Treasury Financial Crimes Enforcement Network (“FinCEN”) Beneficial Ownership Information Reporting Requirements (the “Rule”), which was promulgated pursuant to the 2021 bipartisan Corporate Transparency Act, is intended to help curb illegal finance and other impermissible activity in the United States.

“In for a Penny, in for a Pound” is No Longer the Case for Florida Lawyers

On April 1, 2024, newly adopted Rule 1.041 to the Florida Rules of Civil Procedures goes into effect which creates a procedure for an attorney to appear in a limited manner in civil proceedings.  Currently, when a Florida attorney appears in a civil proceeding, he or she is reasonable for handling all aspects of the case for their client.  This new rule authorizes an attorney to file a notice limiting the attorney’s appearance to particular proceedings or specified matters prior to any appearance before the court.  For example, an attorney can now appear for the limited purpose of filing and arguing a motion to dismiss.  Once the motion to dismiss is heard by the court, the attorney may file a notice of termination of limited appearance and will have no further obligations in the case.

Enhancing Privacy Protections for Substance Use Disorder Patient Records

On February 8, 2024, the U.S. Department of Health and Human Services (“HHS”) finalized updated rules to 42 CFR Part 2 (“Part 2”) for the protection of Substance Use Disorder (“SUD”) patient records. The updated rules reflect the requirement that the Part 2 rules be more closely aligned with the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) privacy, breach notification, and enforcement rules as mandated by the Coronavirus Aid, Relief, and Economic Security Act of 2020.

Columbus, Ohio Ordinance Prohibits Employers from Inquiries into an Applicant’s Salary History

Effective March 1, 2024, Columbus employers are prohibited from inquiring into an applicant’s salary history. Specifically, the ordinance provides that it is an unlawful discriminatory practice to: