Venable partner Kevin Shepherd was quoted in a May 18, 2012 article in the Daily Journal on a proposed federal rule by the Financial Crimes Enforcement Network (FinCEN) aimed at reducing money laundering and terrorist financing. Under the proposed rule, financial institutions would be required to collect and report information on account holders and beneficial owners. The rule is opposed by the American Bar Association (ABA).
Commenting on the proposed rule through his position as chair of the ABA Task Force on Gatekeeper Regulation and the Profession, Shepherd wrote that the proposed rule could have “the unintended - and - onerous effect of requiring law firms to report the identity of their individual and corporate clients and to submit detailed beneficial ownership information regarding each of their corporate clients.” Speaking with the Daily Journal, Shepherd said “the ABA favors the current system of expanded client due diligence and risk-based assessments over federal legislation or regulations.” Added Shepherd, “A voluntary compliance model balances the attorney-client privilege and client confidentiality concerns together with a risk-based approach… Legislation runs the very real risk of running afoul of the attorney-client privilege and the duty of client confidentiality and the attorney-client relationship.”
Commenting on the proposed rule through his position as chair of the ABA Task Force on Gatekeeper Regulation and the Profession, Shepherd wrote that the proposed rule could have “the unintended - and - onerous effect of requiring law firms to report the identity of their individual and corporate clients and to submit detailed beneficial ownership information regarding each of their corporate clients.” Speaking with the Daily Journal, Shepherd said “the ABA favors the current system of expanded client due diligence and risk-based assessments over federal legislation or regulations.” Added Shepherd, “A voluntary compliance model balances the attorney-client privilege and client confidentiality concerns together with a risk-based approach… Legislation runs the very real risk of running afoul of the attorney-client privilege and the duty of client confidentiality and the attorney-client relationship.”