Does a corporate ownership chain provide any real privacy?

It depends on the state. Some states publish the managers, some don't. If you're in Wyoming, you can hide members but the registered agent is public. If that agent is you, game over.

I've set up a few of these chains for clients. The chain works until someone files a lawsuit and gets discovery. Then the corporate veil is thin. Privacy from casual search, yes. Privacy from a determined adversary, no.

What about FinCEN? Doesn't the new beneficial ownership reporting kill all this? I thought I read that small companies have to report their owners now.

FinCEN is a real issue. But the reporting is not public. It's just for law enforcement. So it doesn't help your neighbor find out, but it does mean the government knows. If your threat model includes the feds, then no, it doesn't provide privacy.

Competitors can still find you through your website, your address, your phone number. The corporate chain doesn't hide your operational footprint. You have to separate the business identity from your personal identity in every way, not just on paper.

I tried a two-layer LLC structure. The outer LLC was in New Mexico, the inner in Delaware. It took me about a month to set up. Then I realized my registered agent was a friend, and he got a subpoena for a different case. My name came up because he was the agent of record. So the chain ddin't help there. It was a mess.

That's a classic mistake.The agent is a weak point. If the agent is a person, they can be pressured. If it's a company, they can be served. The chain doesn't protect you if the agent is not robust.

So what's the point then? Just ude a nominee service?

Nominee services have their own problems. Some states require disclosure of the nominee's identity if asked by the secretary of state. And if the nominee is a company, you still have to disclose the true owners to that company. So you're trusting someone else with your info. That's a trade-off, not a solution.

The chain gives you time. If someone is just doing a quick search, theey see the holding company, and stop. But if they push, they can find the next layer. It's about raising the cost of the search. For most people, two layers is enough. For a journalist or a lawyer, it's not.

I wouldn't say it's useless. If you're trying to keep your home address off Google, it works. If you're trying to hide from a determined investigator, it doesn't. You You have to define your goal.

Also, don't forget about the IRS. They get the ownership ownership info from FinCEN anyway. So if you're worried about the government, the chain does nothing.

One more thjng: the corporate registry in some states will show the formation date and the agent's address. If you formed the company at the same time as your other companies, that's a pattern. People can connect the dots. So the chain only works if you vary your timing and your agents. That's a lot of work for marginal benefit tbh.

At that point, just use a trust. Or a foundation. But those have their own reporting.