Which entity is explicitly exempt from Beneficial Ownership rules?

• A. Publicly traded companies
• B. NGOs, charities and religious organizations
• C. Entities registered with the SEC
• D. Sole Proprietorships

Answer: (D)

Beneficial ownership rules focus on identifying natural persons who ultimately own or control a customer. A sole proprietorship isn’t a separate legal entity; the owner and the business are one and the same. Because there isn’t a distinct ownership layer to identify, there’s nothing to report under the beneficial ownership rules, so this type of entity is explicitly exempt. The other options involve entities that do have separate ownership structures: publicly traded companies and SEC-registered entities have owners and controlling persons, and NGOs, charities, and religious organizations can be controlled by individuals or boards, so they aren’t automatically exempt in the same way. Therefore, the sole proprietorship is the explicit exemption.