FinCEN announced that it will require title insurance companies to determine who the “beneficial owner” is of an entity that pays cash (or certified check) to purchase property in either Manhattan or Miami.
The Geographic Targeting Orders require reporting of cash purchases of over $3 million in Manhattan and $1 million in Miami.
“Beneficial owner” is defined as an individual with 25% or more of the equity interests in the entity purchasing the property. A copy of the beneficial owner’s “driver’s license, passport, or other similar identifying documentation” must be obtained.
FinCEN is concerned that people are using entities to purchase property with cash in order to shield their identity. The GTO is designed to evade this practice by requiring identification of the beneficial owners of the purchasing entities.