Insights and updates
from MinuteBox

On January 1, 2024, the Corporate Transparency Act (CTA) was enacted. The CTA primarily aims to provide greater oversight and accountability into legal entities. The law is part of a broad effort by the US Department of Justice to crack down on white-collar crimes, including fraud, money laundering, and financing acts of terrorism.

The CTA stipulates that business entities must provide diligent reports on beneficial ownership of their organizations. Beneficial ownership data, by law, must be submitted to the Department of the Treasury’s (DOT) Financial Crimes Enforcement Network (FinCEN). Companies required to comply must submit beneficial ownership reports by the appropriate deadlines.

What are those deadlines, and how can you prepare to comply with the CTA mandate? Here is a breakdown of what to know, what to do, and how to comply with the laws.

What do you mean by beneficial ownership?

Firstly, what does beneficial ownership mean, and what does the CTA classify as beneficial ownership data?

Generally speaking, beneficial ownership refers to corporate shareholders who share a business entity’s profits or have the right to influence the entity’s operations. A beneficial owner must possess or control at least 25 percent of ownership interest in a reporting entity.

FinCEN expects each reporting entity to file four pieces of information about each beneficial owner. That reporting data includes:

• The beneficial owner’s name
• Their date of birth
• The owner’s home address
• A legal identifying number from a valid government ID

FinCEN will not accept identifying numbers from expired driver’s licenses, passports, or state-issued identification documents. If no valid documentation exists, exceptions will allow owners to supply identifying numbers from non-expired foreign passports.

When must you report beneficial ownership data?

FinCEN has classified legal entities into two types of businesses — existing entities and newly created organizations. Existing entities refer to any registered corporation that operated before January 1, 2024. Newly created entities are businesses established after the official enactment of the CTA.

Existing businesses have a full calendar year — until January 1, 2025 — to submit their beneficial ownership reports to FinCEN. The DOT recognizes that established entities have numerous beneficial owners, often located in different jurisdictions. As a result, gathering all the applicable reporting data will take time.

However, newly created businesses have only 90 days to file their reporting data. That means a newly registered corporation has until April 1, 2024, to submit their beneficial ownership reports to FinCEN.

What other reporting data must you submit to FinCEN?

Reporting entities must also submit information about their organizations with beneficial ownership data. Specifically, FinCEN asks for the name and primary address of the corporation’s main office in the reports.

Newly established entities — created on or after January 1, 2024 — must also submit beneficial data about the company founders. Generally speaking, new entities have smaller advisory boards and fewer shareholders. Therefore, the company applicants are deemed the primary beneficial owners of newly established corporations.

How to file accurate beneficial ownership reports

All qualifying business entities must submit diligent and accurate reports to FinCEN. Failure to provide accurate, transparent, and relevant information can result in stiff financial penalties and legal consequences for violating corporate entities.

Therefore, it’s incumbent upon in-house legal departments or contracted law firms to submit accurate reporting data to FinCEN. The best way to create detailed and relevant reports is to eliminate the potential for human error and missing information.

Entity management software is the best resource to assist this process. Entity management platforms like MinuteBox have built-in templates and guided widgets to help legal teams file all beneficial ownership data. The platform uses prompts and push notifications to inform legal teams if data is missing or inaccurate, eliminating risks of faulty or misrepresented reports.

Law firms and in-house legal departments have streamlined legal entity management using cloud-based solutions like MinuteBox. Now that the CTA mandate is law, there’s an even greater need for cloud-based entity management solutions.

Join the MinuteBox revolution today

Don’t fall behind on your reporting obligations — beneficial ownership reporting and general entity management reporting. Cloud-based entity management platforms will help your legal team compile all relevant data and submit diligent and accurate reports to FinCEN.

Step into the modern era of entity management and protect your entity from legal consequences. Join the MinuteBox revolution today and simplify beneficial ownership reporting.

Corporations hire experienced legal professionals to oversee legal entity management on behalf of the business. These hires can be either in-house, under the direction of general counsel, or as contracted members of an outside law firm.

In either scenario, legal professionals rely on their team of law clerks or paralegals to help administer entity management best practices. This includes assembling all corporate filings into one centralized database of records to maintain business compliance with regulatory laws.

How corporate entities maintain business compliance

Legal teams follow entity management practices, policies, and procedures to maintain business compliance with regulatory authorities. Entity management is a governance system that organizes the corporate records of a legal entity to improve business compliance and corporate transparency.

Effective entity management organizes records from an array of sources into structured minute book records. Examples of prominent sources to collect entity management data include:

• Organizational charts
• Organizational calendars
• Corporate workflows
• Statutory non-compliance records
• Date-based compliance records
• Clerical and administrative records

Many legal professionals use entity management software to assist with the management of corporate data in support of business compliance. Entity management software is a specialized system built by legal minds for legal minds. It simplifies how law firms and legal departments manage large amounts of corporate data in service of numerous legal entities.

Four tips to help paralegals maintain business compliance

Simplification goes a long way to helping paralegals and law clerks remain on top of the entire business compliance process. Each record of data must be inputted into the master entity management database, which requires diligent recordkeeping skills and vast amounts of time dedicated to this process.

So, how can you make life a little easier for your paralegal team, while still ensuring that business compliance is maintained? Entity management software is one of the best resources to simplify the workload. Here are four helpful ways these platforms will help your paralegal team maintain business compliance, and also preserve their own mental health.

1. No-code document assembly

One of the biggest reasons companies choose not to insert modern technology into their workflows is that platforms require technical expertise to manage. Many legal departments don’t have the staffing or resources to invest in a tech guru. In fact, according to the Association of Corporate Counsel, the median total of legal staff in any given department is just six people.

The chief benefit of entity management software is that it’s built to support the non-technically savvy legal department. The platform includes no-code document generation templates, allowing teams to leverage intuitive software that easily creates and customizes legal documents with no technical requirements. This approach significantly reduces the time it takes to create documents to a few simple minutes.

1. Time to consult with stakeholders

Paralegals and law clerks often wear multiple hats. In addition to managing corporate entity data, their responsibilities include serving as the primary point of contact between the heads of the legal department and the other key stakeholders of the business.

Scheduling time to converse with those stakeholders with fully briefed and informed documentation is a challenge for paralegals. Since the average team has only six functioning staff members, juggling all these responsibilities without sacrificing the requirements for effective business compliance is a tall order.

The simplicity of entity management software streamlines the entire business compliance workflow. Using these systems, legal teams save valuable hours on recordkeeping, enabling more prompt and effective meetings with key entity stakeholders. It’s a workflow that generates value and improves the efficiency of meetings throughout the entire organization.

1. Greater alignment between attorneys and paralegals

Any documentation submitted to regulators will undergo meticulous scrutiny. Business entities provide transparent records to regulators, who then review and make their judgment on whether the entities meet the standards for business compliance.

Sometimes, supportive positioning statements that provide additional context to the records make or break the case for regulators. If there’s misalignment between the legal professionals and paralegals who submit the records to regulators, the argument may become diluted or confusing.

By using a platform that centralizes all records and streamlines the time investment necessary to maintain those records, attorneys and clerks can dedicate more time to making their arguments in clear, concise, and aligned manners. It will also allow any misalignments or disagreements over submissions to be squashed without leaving paralegals feeling threatened or at risk of dismissal.

1. Paralegals will not succumb to burnout

The most consistent benefit of entity management systems is the time saving efficiencies they provide to resource-strapped legal teams. Valuable working time is granted back to legal departments, chiefly, the paralegals, whose primary duties are to maintain those records.
Paralegals are under enormous pressure to maintain business compliance. It’s natural to feel overwhelmed at times, especially if workloads become overwhelming due to rigid time constraints. Using entity management software, the work gets done faster, paralegals feel accomplished, and creeping thoughts of burnout dissipate into the subconscious. It’s a win all around for everyone

White collar crime is a very costly affair in Canada. According to Criminal Intelligence Service Canada, which shares and coordinates criminal intelligence shared between different police agencies, white collar crime costs the country up to $5 billion per year.

Naturally, governments across the country are eager to crack down on these crimes. One of the ways this was done was an amendment to the Canada Business Corporations Act in 2019. The amendments mandate that corporations must provide greater transparency over shareholder equity in their businesses, as well as assist authorities to prosecute financial crimes.

The federal law was adopted by several provinces over the past three years, including British Columbia, Manitoba, and Nova Scotia. As of January 1, 2023, Ontario, the largest province in Canada, will enact its own version of the law.

What the OBCA amendment means for business

The OBCA is the Ontario Business Corporations Act, which has a similar mandate to the CBCA at the federal level. The Ontario government updated the OBCA with rules that enforce similar priorities for corporations to follow as the federal law.

Under the new OBCA legislation, corporations headquartered in Ontario must create and maintain an ISC register with updates reported on an annual basis. An ISC register is a document that lists all of the individuals with significant control (ISC), ensuring all key stakeholders comply with the law. The purpose of the OBCA, and its federal counterpart, is to support a Canada-wide effort to crackdown on white collar crime, particularly tax evasion.

Other provinces have enacted similar legislation of their own, following the lead of the federal example. Quebec has created its own legislation in Bill 78 that’s similar to the CBCA laws, though it has slightly different guidelines for corporations to follow. You can learn more about Quebec’s Bill 78 here.

Who fits the profile of an ISC?

Who exactly is an individual with significant control in a corporate entity? In most situations, an ISC is a registered shareholder with shareholder rights who controls at least 25 percent of the voting rights attached to all outstanding corporate shares. The language in the law also applies the ISC label to any shareholder whose influence, if exercised, could in fact control the decisions made by the corporation.

There are some exemptions to how the ISC classification is applied. For example, if a shareholder is an investor for a purely commercial relationship, reflected in the form of a franchise, license, lease, or some other managerial agreement, their involvement in the corporation’s affairs is considered an “arm’s-length” affiliation. For that reason, that investor would not classify as an ISC.

What needs to be included in an ISC register

Under the OBCA laws, an ISC register must be maintained and updated by a corporation as part of its annual financial statements. However, what exactly needs to be included in an ISC register to comply with the law?

Most of the information in an ISC register is identical to information that most corporations maintain in a standard shareholder ledger. This includes personal information such as names, addresses, dates of birth, and jurisdictions.

There’s one key difference between an ISC register and a standard shareholder register. The difference is that corporations must include the date on which an ISC became an ISC shareholder, and a description of how that individual meets the criteria of an individual with significant control in the corporation.

How to use entity management software to file ISC registers

If your corporation is based in Ontario, you’ll need to create an ISC register to comply with the law. Now, you may be an established corporation with a detailed shareholder ledger, which you can modify with little hassle. But what if you’re a new corporate entity? How do you create a new shareholder ledger without sacrificing laborious hours of your paralegals’ time and energy?

The best approach is to use entity management software to streamline your corporate recordkeeping process. Platforms like MinuteBox have a built-in shareholder register template in our Entity Information Summary that you can use to build out your register, and you can include any required details to highlight investors that fit the ISC profile.

Under the Entity Information Summary is a subsection called the Capital Section. Here, you can input all authorized information about shareholders and corporate transactions in the available open fields.

You might be asking the question: how is this going to save your legal team precious time and manpower? MinuteBox utilizes document automation technology that requires no coding or coding experience to work the platform. It allows your team to work faster but still meet all of the legal criteria necessary to remain in full compliance with both federal and provincial laws. Simply open up the platform and the work can be complete within minutes!

Are you part of an Ontario-based corporation and in need of an efficient solution to complete your transparency register? Join the MinuteBox revolution so that you can comply with updated corporate governance in a fast and efficient manner while maintaining your commitment to accountability and transparency.

Privacy protection and client services are essential to the integrity and reputation of a law firm. Corporations need to know that their confidential records will be in a safe and secure environment. If you’re a law firm, they also need this in order to trust that they can do business with you. Without those assurances, it’s hard for firms to generate new business and maintain mutually beneficial relationships with existing clients.

Cybersecurity is a growing concern for corporations, and for law firms and the clients they represent. The COVID-19 pandemic triggered a rise in cyber attacks on many institutions, including schools and hospitals. But many of those attacks were concentrated on some of the nation’s largest legal firms.

For example, in 2021, the American Bar Association put out a report that found 29 percent of law firms reported a security breach. Even more alarming is the fact that one out of five participants in that report could not say if the breach was, in fact, the first time their firewalls had been penetrated.

Digital recordkeeping is still more secure than loose paper

Don’t let those stories sour your belief in digital minute books and corporate recordkeeping. Storing corporate records in digital format is more efficient, more secure, and more cost effective than relying on traditional paper documents.

Here are some interesting stats from a report compiled by PricewaterhouseCoopers (PWC) that further paint that picture:

• It costs law firms up to $2,000 per year to maintain a single 5 drawer filing cabinet
• Over 4 trillion paper documents are circulating the US each and every year
• The rate of new paper documents is growing at up to 200 percent per year
• Legal professionals and business owners spend up to 50 percent of their time searching for corporate records, but only 5 to 15 percent of their time actually reviewing them

Pretty alarming data, right? An over-reliance on paper documentation leaves many companies and the law firms that represent their interests scrambling to find important files in very tight deadlines. When business owners want answers to their legal questions, they don’t want time wasted trying to find the right documents that can provide that clarity. They want answers immediately, and they want to trust that your firm can supply that information.

Cloud-based entity management is more secure and flexible

Rather than have paralegals and legal professionals at the firm spend valuable billable hours searching for physical client records, there’s a more modern, efficient, and secure way to help your legal team provide immediate answers to pressing client questions. That solution is to transfer your client’s records into the cloud with an entity management platform that makes it faster and easier to get clients the information they need when they need it.

When you decide to do away with loose paper documents, you make it far easier to organize and categorize your client’s minute books. Eliminate the need for those expensive filing cabinets to store physical records by instead uploading files into the cloud. This way, you create sophisticated digital documents that you can share with your clients.

The account is restricted solely to your law firm and your client. Each account is password protected with advanced encryption and cybersecurity features to ensure all minute books and corporate records can only be accessed by those with the authorization to do so.

The best part is that, since these are cloud-based entities, clients can log into the platform and access their records from the convenience of any location in the world. Records are immediately at your fingertips whenever the need arises…provided your location has Wi-Fi.

Is your firm ready to improve corporate record security and client satisfaction? Join the MinuteBox revolution so that you can transform how your firm services clients, manages corporate records, and establishes a credible reputation as a law firm that can be trusted with the security and integrity of trade client secrets.

Law firms everywhere rely on their ability to charge billable hours in order to boost profits for the business. Between certified legal professionals, paralegals, and private investigators; firms have an abundance of human resources to manage and profit from client relationships.

One expectation for a number of firms is the need to increase Legal Recurring Revenue. By measuring Legal Recurring Revenue as a performance benchmark for all associates of the firm, your business can:

• Plan growth forecasts for an entire calendar year
• Ensure the business remains financially stable with no gaps in revenue
• Find the perfect time to raise funds from investors in order to support growth
• Reinvest earnings into professional growth and development, making your firm an attractive business for newer legal professionals

Firms lose Legal Recurring Revenue to recordkeeping

Managing client expectations and ensuring all paperwork is properly documented for an upcoming case is a timely affair. It’s said that firms spend approximately $20k per year per legal professional to manage documentation and minute books for clients. That’s a lot of salary to invest in recordkeeping that, in addition to direct financial costs, also eats up a lot of time that could otherwise be spent growing revenue opportunities for the firm.

It makes sense that minute book recordkeeping cuts into your firm’s bottom line. Everything that’s included in these tasks, such as printing, copying, filing, and searching for lost documents all requires time and resources to complete. While the tasks themselves may appear tedious, they’re all necessary to protect client privacy and increase the chances you’ll win your case.

What if there was a faster way to complete these tasks?

Rather than stick with the old ways of doing things, your firm could modernize how you maintain minute books with modern technology. Using cloud-based entity management solutions, you no longer need to store physical binders and documents at your office. Instead, all minute books and important records can be uploaded into a safe and secure cloud-based environment.

The best part of these solutions is that they allow your firm to store, scan, sort, and share important records within minutes. Rather than physically sort through each individual record, your team of paralegals can transform those physical records into secure digital documents.

All of that time spent on managing records can instead be used to complete tasks that directly contribute to the growth of the firm. With cloud-based entity management technology, your paralegal team looks like a group of rockstars in the legal community!

No coding or development experience required

Not every law firm has an IT department; even in those rare firms that do have in-house technical support, there are still few experienced developers to spare. Relying on coders with limited time to access, upload, manage, or share digital documents costs nearly as many working hours as physical minute book recordkeeping.

That’s why cloud-based entity management solutions are so valuable for growing firms. Enterprise grade scanning services are built directly into the platform’s capabilities, which means you can transition your record book collection to the cloud efficiently, securely, and with the highest commitment to quality standards for your clients.

All scanning can be completed within the four walls of your office to maintain client security. This ensures that all private data is fully protected throughout the transition to digital documentation. Once uploaded to the platform, cloud-based security parameters protect all client records and minute books from public exposure. Access is strictly limited to the very few professionals who have been given permission to view the account.

Earn back more time to grow Legal Recurring Revenue

No code entity management solutions make it faster and easier to complete the tasks that help maintain client relationships. By giving more time back to your paralegal professionals, your firm can dedicate more time and manpower to servicing growth and managing Legal Recurring Revenue that will ultimately improve the firm’s bottom line.

Solutions like these have helped both large and small firms take the next step in their own respective journeys towards growth. We have a great Q&A style story with the founder of the multidisciplinary firm Hub6, who successfully focused on delivering growth thanks to the technological solutions implemented that streamlined the day to day management of the firm.

Is your firm ready to be the next Hub6? Join the MinuteBox revolution so that you can implement no code entity management solutions across your law firm’s operations and earn back more time that you can devote towards boosting revenue for the business.

The regulatory compliance landscape is constantly changing. Governments enact new policies and regulations to modernize compliance standards, increase corporate transparency, and protect the rights of citizens.

For example, the Corporate Transparency Act was enacted on January 1, 2024, requiring qualifying business entities to submit diligent beneficial ownership information (BOI) reports to the Treasury Department’s Financial Crimes Enforcement Network (FinCEN).

Additionally, cyber compliance laws enforce strict information security and data privacy standards. Companies must invest in protecting sensitive data and prohibit data security breaches so compliance is maintained.

So what are some ways to adapt to regulatory compliance changes? How do you keep your business on the right side of compliance law?

MinuteBox helps entities monitor regulatory compliance

Traditional regulatory corporate compliance was a tedious process. Legal and compliance departments were forced to dedicate countless hours to rigorous data entry to create compliant entity management.

Solutions like MinuteBox provide modern and more efficient workflows to maintain regulatory compliance. The platform includes templates and guided widgets that inform legal and compliance teams of the exact data required to complete minute book records.

Gone are the days of cycling through countless records to find accurate reporting data. MinuteBox’s intuitive system converts entity management data into structured PDF files identical to standard minute book records.

If there are gaps in the reporting data, the platform prompts your team if there is any missing data. As a result, your legal and compliance managers know exactly what data is necessary to complete the records and maintain compliance. It’s a fast, easy, and efficient workflow!

5 MinuteBox strategies to maintain compliance

Thousands of law firms and corporate counsel departments trust MinuteBox to monitor annual compliance. The platform saves valuable time implementing legal entity management structures and automating compliance solutions within a secure cloud-based solution.

These are five excellent strategies to use MinuteBox and maintain regulatory compliance.

Centralize your records and assess the effects of new regulations

Entity management software functions as a single source of truth for regulatory compliance. All reporting entity data is centralized in one system, which makes it easy for your legal and compliance teams to review the accuracy of reported data.

When new regulations pass into law — such as the Corporate Transparency Act — simply open your MinuteBox registry and evaluate which entities or subsidiaries are impacted by the new regulation.

Your legal and compliance teams can enact a proactive workflow to gather any new reporting data and align with the new requirements. It allows your teams to work more efficiently and productively without excessive new time-consuming or financial costs to the business.

Use effective collaboration tools to ensure timely stakeholder engagement

If new laws require additional reporting information, that data must be found, secured, and inputted into your minute book reporting records. Some of that information can only be provided by specific stakeholders within the corporation. Engaging those stakeholders and ensuring their collaboration can be very time-consuming without collaborative solutions.

Thankfully, MinuteBox has built-in collaboration features that simplify the workflow. The platform enables real-time collaboration so that you can work with your colleagues to update all necessary reporting data.

Best of all, you can tag any stakeholder whose name is attached to your organizational charts. They’ll receive a notification from the MinuteBox platform that their assistance is required to complete a regulatory compliance task. All communication occurs within the platform so your teams can submit filings by the appropriate deadlines.

Enhance data governance to improve organizational decision-making

As stakeholders provide reporting data, they may ask reasonable questions about the compliance records. The organization may have to make crucial decisions about enhancing current regulatory compliance processes. To do so, they require advanced reports.

Advanced Reporting by MinuteBox offers unparalleled reporting capabilities. Customizable reports can be generated for thousands of entities or subsidiaries under your corporate umbrella. Once again, all reported data is shareable with all key stakeholders directly within the MinuteBox platform.

Suppose certain entities or subsidiaries pose greater liabilities to the corporation than they’re worth. With MinuteBox’s Advanced Reporting, you can quickly determine which entities pose more risk than reward so that decisions can be made about the future of those operations.

Bring efficiencies into all regulatory compliance processes

As a business, part of the operating mandate is to find new efficiencies to streamline operations. Compliance protocols are often tedious and time-consuming, but they are necessary to protect the organization. Nevertheless, there are always ways to make the compliance reporting process more efficient.

Perhaps one of MinuteBox’s greatest benefits is the time-saving efficiencies it delivers to regulatory compliance workflows. The intuitive nature of the platform, coupled with the guided widgets and pre-built templates of minute book records, makes it quick and easy for your legal and compliance teams to generate detailed compliance reports.

Compliance reports are mandatory requirements, but they can be completed faster and easier with modern technology. Speed, precision, and efficiency are all available when entities use solutions like MinuteBox to implement proficient regulatory compliance workflows.

Create organizational transparency while guaranteeing data security

Remember that cybersecurity matters are a growing concern for all corporate entities, so it’s important to use compliance reporting solutions that guarantee data integrity and security.

MinuteBox is the only entity management platform to receive both ISO 27001 and SOC 2 Type II certifications. These certifications demonstrate MinuteBox’s commitment to upholding the highest possible data security and information management standards.

The platform uses biometric and hardware key authentication to restrict access to entity management records. Multiple stakeholders are involved in the compliance reporting process, and maintaining all compliance data within the MinuteBox platform gives qualified stakeholders access to corporate records while ensuring no data is breached or compromised.

Are you ready to modernize regulatory compliance reporting with the best entity management solutions on the market? Join the MinuteBox revolution today and remain one step ahead of all adaptive regulatory compliance protocols.