In early December, a Texas federal court blocked the Corporate Transparency Act nationwide, throwing family offices and more than 32 million other businesses into compliance limbo just a few weeks before a January 1 deadline. That was the beginning of the drama.
The preliminary injunction set off a series of legal challenges throughout the holiday season. While most people took an uninterrupted break from work, the “CTA warriors” — the attorneys and others responsible for knowing if or when their clients had to share beneficial ownership information about businesses with FinCEN — constantly checked their phones and computers for the latest twist and shared updates and their takes online.
During the three weeks after the nationwide block, the CTA was reinstated, the deadline to comply was moved back to January 13, and the law’s enforcement was halted again. Then, on New Year's Eve, the Justice Department appealed to the Supreme Court on behalf of FinCEN.
Things have only gotten more interesting in 2025. Last week, Justice Samuel Alito set a deadline of 4pm today (January 10) for the plaintiffs to submit their response before the Supreme Court rules on the CTA. Meanwhile, the Biden administration urged the court to allow the CTA’s enforcement, a second Texas judge blocked the CTA enforcement, and attorneys general from 25 Republican-led states filed an amicus brief yesterday urging the Supreme Court to keep the blocks in place, arguing that the law would harm their local economies. A Supreme Court decision could arrive today or take weeks.
CTA-warrior morale is getting low. But perhaps no one is suffering during this uncertainty like Frank Tumminello, a co-founder of FileForms, a startup he launched to help businesses organize and file their beneficial ownership information more easily. FileForms was inspired by the CTA, and the law’s future, at least as of this email, is not totally clear.
“Tuesday, December 3rd. I'll never forget that day,” Tumminello said wryly with the tone and cadence of a documentary interviewee reflecting on some tragedy.
While working at an investment bank and a private equity firm, Tumminello was focused on highly regulated industries, and he realized that some of the best businesses are boring and provide non-discretionary services — like helping companies submit information to the government that they are required to. When a bipartisan Congress passed the CTA in 2021 to combat money laundering through anonymous companies in the U.S., which can be tools to support corruption, drug trafficking, and terrorism, Tumminello and Kenneth Dettman saw an opportunity. Millions of businesses leaning on what they assumed would be bare-bones government software to submit beneficial ownership information would be “complete chaos,” so they founded FileForms.
In December, as the original January 1 deadline approached, FileForms was pacing to quadruple the number of customers it served in a single month. But that growth slowed when the legal drama began, causing the startup to delay some initiatives, Tumminello said.
The startup was happy to see the government quickly appeal the first injunction. Still, a week later, FinCEN turned off its API, giving FileForms and other companies direct access to easily submit information on anyone’s behalf. This rattled the startup. “Wow, maybe this is going to be a change forever,” Tumminello thought. FileForms and other companies asked FinCEN to turn it back on so they didn’t lose too much momentum. FinCEN turned it back on about a week later.
Tumminello says he isn’t worried about the future of the CTA or FileForms. Until it has a reason to feel differently, the startup is viewing everything up to this point as a mere delay; the CTA will survive litigation and family offices and other companies will have to comply with it eventually.
Even though President-elect Donald Trump and his incoming administration want to lessen regulation, Tumminello says that the CTA is a matter of national security. A Supreme Court ruling last year in an unrelated case also established some precedent and effectively limited a district court judge from implementing a nationwide injunction.
Unlike many other startups, Tumminello and Dettman bootstrapped FileForms and said it is “growing very, very quickly and highly profitable. We're thrilled to be in the position that we are, and hopefully, there's never a need to raise outside capital.” More than 100,000 businesses and over 10,000 professional service providers use FileForms. “Hundreds” of family offices use FileForms either directly or through an intermediary.
Knocking on doors of and advertising broadly to more than 32 million businesses wasn’t a reasonable way to grow. When FileForms’ service launched in 2023, it started reaching out and partnering with large communities of businesses, accounting and law firms, family offices, and others that the startup knew would have to comply with the CTA. Those professionals are incentivized to ensure their clients remain lawful and avoid steep fines. Tumminello, the startup's CEO, has also become somewhat of a CTA influencer by writing, podcasting and appearing on TV to raise awareness about the law’s requirements and educating those professionals.
If the Supreme Court rules against the CTA, many businesses that might have to comply with the law already have to make similar disclosures at the state level. FileForms has added features like annual reports and registered agent services to fill those needs. Soon, it will offer business formation services, another step toward creating an enterprise solution that Tumminello says will save businesses time and, in some cases, many thousands of dollars by allowing them to avoid continuously relying on their corporate attorneys.
CTA enforcement would be significant for FileForm’s business, but the startup already has plenty of customers using it for other purposes and is adding new ones daily. “I think a lot of folks do appreciate the nature of this law having a purpose, and probably a lot of folks just don't want to follow a court case over the next few months and just want to get this out of the way because the fines are significant, and if they come back into effect on short notice, then they don't want to miss it,” Tumminello said.
He added: “Family offices typically don't have a bunch of folks sitting around waiting to do manual work, nor do they hire seasonal employees. So we can really be that platform that enables them to stay ahead of this stuff so that they're never caught in a tough spot.”
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Other News
- Yesterday, the Simons Foundation, created in 1994 by Jim and Marilyn Simons to support research in mathematics and the basic sciences, released a well-done tribute video to Jim. The mathematician, code breaker, and founder of the quant firm Renaissance Technologies, who became one of the most successful investors ever, died last year at age 86. The New York-based foundation has a staff of over 500 people, half of whom are scientists, and had more than $4.5 billion in assets in 2023.
- In November, a banana taped to a wall sold at auction for $6.2 million, but that’s just one piece. It’s a buyer’s art market and collectors can best take advantage of it if they “avoid waitlists, request private resale opportunities for works they are interested in and negotiate for larger discounts given the current conditions,” Matthew Newton, an art advisory specialist at UBS, wrote in the first issue of the bank’s latest family office quarterly.
- Walt Deriso was promoted to CEO and Hamilton Hilsman was promoted to president of the family office group at Synovus, a publicly traded, mid-cap bank in Columbus, Georgia. The family office group was established in 1947 and today has 45 team members advising clients on $11 billion in assets.
- Why Are We Tormented by the Future?
Jobs
- Beatrice Advisors, the independent multifamily office founded by Christina Lewis, daughter of the intrepid Black businessman Reginald Lewis, is looking for a senior associate to join it in New York. The new hire will have a “unique opportunity to build out the client services offering” at the firm, which was founded last year. The salary range is $100,000 to $130,000, but actual compensation will be based on the hire. Beatrice Advisors is an evolution of Lewis’s single-family office, BFO21.
- Iconiq Capital is looking for a senior analyst to join its family office advisory group in San Francisco to do a lot of the usual: help more senior team members onboard new clients, manage the multifamily office’s existing relationships, and maintain its CRM (Salesforce). The estimated compensation is a $110,000 to $120,000 salary plus a discretionary bonus.
- Northern Trust is hiring a CIO for North America. This person will actively participate in discussions about the firm’s views on the economy and markets and coordinate with the CIO focused on asset allocation, as well as other investment leaders, to build portfolios. The job pays a salary of $350,000 to $650,000.
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