FATF Recommendation 24 addresses ultimate owners or controllers of legal persons. Adequate, accurate and current beneficial-ownership information should be rapidly accessible to competent authorities, connecting corporate transparency with national AML/CFT laws and supervision.
TL;DR:
- Authorities need rapid access to adequate, accurate and current legal-person ownership information.
- Effective mechanisms require risk assessment, verification and access arrangements.
- Company records support due diligence but may not resolve complex control chains.
Summary
Seeing the natural persons behind a legal entity
Recommendation 24 seeks to prevent companies and other legal persons from concealing the people who ultimately own or control them. Formal incorporation data and a list of immediate shareholders may describe only part of the structure. The beneficial-owner concept concerns natural persons and can involve ownership or effective control through several layers. This makes corporate transparency relevant to both competent-authority investigations and the due diligence performed on business customers.
Adequate, accurate and current information
The standard calls for competent authorities to have efficient access to adequate, accurate and up-to-date beneficial-ownership information. Registers or other effective mechanisms need to provide more than an unverified name field. Countries should assess risks associated with legal persons and establish arrangements that support reliability and access. The framework therefore connects collection with verification, maintenance and use, rather than treating the mere creation of a corporate database as the final outcome.
Revised standards and practical implementation
FATF revised Recommendation 24 in 2022 and published updated guidance in 2023. The guidance addresses measures to prevent misuse of legal persons and the relationship between public transparency mechanisms and private-sector preventive controls. It is intended to support implementation, not override national authorities. Ownership and control information can also be relevant to sanctions or other investigations, but those regimes have their own legal tests and should not be assumed to produce the same conclusion.
The link to corporate payment customers
For a payment provider, a registry entry is an input to understanding the customer, not a universal answer to every ownership question. The institution needs to connect the corporate structure, natural persons and actual relationship under its applicable due-diligence obligations. Changes can make earlier information incomplete or stale. National law determines binding reporting, access and enforcement arrangements. Trusts and similar legal arrangements are addressed separately in Recommendation 25, which should be distinguished from this legal-person framework.
Keywords
- Recommendation 24
- legal persons
- ultimate ownership
- control chains
- accurate registers
- authority access
- information verification
- corporate transparency
- current records
- national mechanisms