Several pieces of legislation in Congress would require millions of small businesses in America to comply with complex and ambiguous “beneficial ownership” reporting requirements.  Recently, the House Financial Services Committee held a hearing on a discussion draft of the “Counter Terrorism and Illicit Finance Act.” Section 9 of this bill, titled “Transparent Incorporation Practices,” is directed squarely at the smallest businesses in America – specifically, only firms with 20 or fewer employees would be subject to the rules. Ownership changes would have to be reported within 60 days and failure to comply could result in fines up to $10,000 and prison sentences of up to three years. Any true money launderer could easily and lawfully avoid this requirement by forming a partnership or business trust, using a larger firm or taking advantage of one of the exempt categories. In the final analysis, all this bill would do is impose a massive paperwork burden on America’s smallest companies. The bill will do nothing to hinder terrorism or money laundering. Similar legislation has been introduced in the Senate but so far has received little support.