Thank you for the question.
There are two aspects of the penalties set out in the bill.
First, the $5,000 fine is only for administrative errors made by a company that doesn't comply with the details described in the bill.
Moreover, the bill includes an additional fine of $200,000 and a prison term of up to six months for non-compliance with the provisions of the bill.
It's a distinction between the two types of penalties. There are administrative penalties for an organization that simply makes an administrative error in their registry of beneficial owners or for failure to do so in an administrative manner. Then the second type of penalty is for a clear contravention of the spirit of the law, which is when you knew of information related to a beneficial owner that you failed to include. That can be up to $200,000 and up to six months in prison.
We do think that balance is right in terms of administrative burden for the vast majority of these private corporations that are small and medium-sized enterprises, but there's also the significance of a significant fine and prison time for those who are bad actors using corporate shells.