Tag Archives: finance

Go Forward. Move Ahead.

(Wildebeest bridge picture via Imagen 3)

A few of you know the particulars of this story about avoiding long-term risk for short-term gains. But the particulars aren’t critically important to most readers.

The business risk of new markets

One time a company wanted to enter a new market. This new market would completely change the way the company did business, both from a technological perspective and from a business perspective.

While the technological challenges were daunting, as usual the business challenges were even more so.

The biggest risk to the company was that the new market operated on a different revenue model, one in which revenue was deferred.

  • In the company’s current market, revenue started at contract signature.
  • But in the new market, the company would have to wait over a year and a half after the contract was signed before it received a dime of revenue.

In a publicly traded company, or even a privately held one, the powers that be are reluctant to undertake an initiative where they won’t get any revenue for 18 months.

“The quarter ends in less than 8 weeks. We want revenue NOW!”

So the company hemmed and hawed about entering the new market, scared of the financial risk. Finally it told its prospect that they’d enter the new market…if the prospect would make an immediate down payment. The prospect was not pleased and went with the company’s competitor instead. And the competitor continued to dominate this market.

For a time.

A few years later, the original company decided to accept the financial risk and, in the words of Devo, “go forward” and “move ahead.” And luckily for the company, it wasn’t too late. The company successfully entered the new market and became a dominant force.

Quarterly gains via risk aversion

We see this today, where a number of companies are struggling to survive. They do the prudent thing, letting go of the employees who don’t provide immediate revenue and concentrating on those who do. The engineers who can code something NOW! The salespeople who can get contract signatures NOW!

This isn’t necessarily the wrong thing to do. If your firm is about to close its doors, you have to do whatever you can to keep the business operating.

But what after that?

Continue to act in a reactive way, chasing the next short term deal?

Good luck.

Why Invela TPRM?

During my three months working with a third-party risk management (TPRM) client, I never heard anyone mention Invela.

Perhaps with reason. Although LinkedIn says the company was founded in 2024, it didn’t post its first blog until April 20, 2025, or its first LinkedIn posts until April 21.

But the second blog post, dated April 21, is the one that matters.

“Invela has officially launched a transformative network to bolster consumer protection and foster innovation within the open banking ecosystem. The Invela Network, developed in collaboration with industry-leading specialist partners, promises to revolutionize how financial institutions manage third-party risk…”

The post goes on to cite the Consumer Financial Protection Bureau (CFPB), but…well…that’s nice.

Invela’s TPRM solution specifically targets the open banking segment of the financial services industry. Open banking, featuring companies such as Plaid, Kong, and Camunda (among others), facilitates the interchange of financial data, rather than keeping it within each bank’s walled garden.

Which of course increases risk.

Hence companies such as Invela.

I was unable to find a “why” story for Invela that compared to the why story I previously found for Ubiety Technologies. Obviously the Invela people never read my book.

However, the principals at Invela come from companies such as Mastercard (although I could find no information on Invela’s CEO Steve Smith). But the Invela leadership team presumably knows their market. We will see if they know their marketing.

Which reminds me…if you need help with your cybersecurity product marketing, Bredemarket has an opening for a cybersecurity client. I can offer

  • compelling content creation
  • winning proposal development
  • actionable analysis

If Bredemarket can help your stretched staff, book a free meeting with me: https://bredemarket.com/cpa/

When Beneficial Ownership Diverges From Legal Ownership

I recently discussed some proposed changes to the way in which beneficial ownership information (BOI) is collected. However, even after the changes are made, FinCEN will still collect BOI for foreign firms.

Hungary, facial recognition, and geolocation

Biometric Update recently published a story about facial recognition in Hungary, and its use to identify people who display rainbows and dress in ways “that diverge from the gender they were assigned at birth.” I’m going to zero in on one portion of the story: the facial recognition provider involved.

The company FaceKom has been around under different names since 2010 but has seen significant growth during the past few years thanks to investments from the Central European Opportunity Private Equity Fund (CEOM). The fund has no direct links with [Prime Minister Orbán’s son-in-law, István] Tiborcz. However, it is registered on the same address in Budapest where several companies owned by Orbán ‘s son-in-law operate.

Ah, geolocation! The Chi Fu Investment Fund Management Zrt.’s address of record is 1051 Budapest, Vörösmarty tér 2.

And do you know what else is at that address?

A Western Union Currency Exchange.

From https://interchangefx.com/branches/vorosmarty/.

Well, that’s enough to drive some conspiracy theorists crazy.

Beneficial ownership and legal ownership

So I didn’t find the smoking gun, but I do want to take this opportunity to point out what BENEFICIAL ownership is. Investopedia:

A beneficial owner is a person who enjoys the benefits of ownership even though the title to some form of property is in another name.

Using the Hungarian example (without the Western Union part), it’s not enough to say that CEOM and/or Chi Fu Investment Fund Management Zrt. (I don’t know enough Hungarian to confirm they are one and the same) does not list István Tiborcz (or Victor Orbán) as an official owner or co-owner.

As Unit21 points out, you don’t have to literally own (either on your own or through a trust) 25% of an entity to be a beneficial owner. Here’s another criterion of a beneficial owner:

Any individual that holds a significant ability to control, manage, or direct the legal entity

De facto control without de jure control could very well be wielded by a powerful politician, or his son-in-law.

(Imagen 3)

FinCEN Domestic BOI Changes: Terrorists Have Not Already Won

A Bredemarket message about financial identity and anti-money laundering (AML) enforcement.

A huge loophole?

Tell your firm’s fraud-fighting story: https://bredemarket.com/cpa/

(Money laundering picture from Imagen 3)

Don’t Know Your Business and Corporate Transparency Act Limited Enforcement (Oh BOI Again)

AuthenticID shared the following:

“In March, the U.S. Treasury Department announced it would no longer enforce the Corporate Transparency Act, the anti-money-laundering law that requires millions of businesses to disclose the identity of their real beneficial owners.”

Not entirely accurate as we will see, but the details are gated. But not at JD Supra:

“On March 26, 2025, FinCEN issued an interim final rule and request for comments, removing the requirement under the Corporate Transparency Act (CTA) for both U.S. companies and U.S. persons to report beneficial ownership information to FinCEN. The rule is effective March 26, 2025. Thus, subject to additional rule changes, U.S. companies and U.S. individuals no longer have to file an initial Beneficial Ownership Information Report (BOIR) or otherwise update or correct a previously filed BOIR.”

As the interim rule itself clarifies, foreign companies still have to report.

“On March 2, 2025, Treasury announced the suspension of enforcement of the CTA against U.S. citizens, domestic reporting companies, and their beneficial owners, and Treasury further announced its intent to engage in a rulemaking to narrow the Reporting Rule to foreign reporting companies only.”

The interim rule itself addresses the convoluted history (one, two, three) of FinCEN’s attempts to enforce anti-money laundering (AML) laws as court challenges persist.

I will let you judge whether this is welcome relief from bureaucracy for American companies, or a huge FinCEN loophole that facilitates AML financial identity evasion by simply letting companies represent themselves as domestic, allowing them to launder as much money as they please for terrorists, drug dealers, and others.

Not that I have an opinion on that.

(Business terrorist image Imagen 3/Google Gemini)

Bredemarket’s Three (So Far) Industry Pillar Pages

Since I started creating (sort of) pillar pages in April 2022, I’ve built more, including three devoted to particular industries.

My “Banking Changes” Post Needs an Update

Back in July 2023, I wrote a post about financial remote onboarding which included a section entitled “Three changes in banking over the last fifty years.” The first change I addressed was locational change.

The first crack in the whole idea of “going to the bank” was the ability to bank without entering the door of the bank…and being able to bank on Sunday at midnight if you felt like it. Yes, I’m talking about Automated Teller Machines (ATMs), where the “teller,” instead of being a person, was a bunch of metal and a TV screen.

But when I was recently reading a Bluesky post from mclevin that stated (correctly) that the decline in tellers didn’t start with artificial intelligence, but automated teller machines, it occurred to me that even the once-revolutionary ATM is itself outdated in financial terms.

Think about it.

What are the two most important functions of an ATM?

  • To deposit paper checks.
  • To obtain physical cash.

I think you see where this is going.

While the ATM still fulfills these functions today, how often do we receive paper checks? And even if we do, why go to a distant ATM to deposit the check when you can often perform the same function using your mobile phone?

And how often do we use cash to pay for things? Often we use a card…or a mobile phone.

Why No BOI?

(Business terrorist image Imagen 3/Google Gemini)

I asked my good buddy Google Gemini to describe the court arguments against FinCEN beneficial ownership reporting (which as of this hour is on a court-mandated hold pending a possible Supreme Court stay). Two of the items identified by Gemini are Bill of Rights related.

“Some argue the reporting requirements force businesses to disclose information about their owners, which they consider a form of compelled speech. The First Amendment protects freedom of expression, and this argument suggests the government is overstepping its bounds.”

“Critics argue that the collection of beneficial ownership information constitutes a search under the Fourth Amendment. They contend that this collection is overly broad and lacks sufficient justification to meet the constitutional standard of reasonableness.”

Human sources, including Engage Wealth Advisors, mention these same concerns.

So the big boys are still subject to KYC, KYB, and AML regulations, while the little boys (sole proprietors) aren’t. The ones in the middle who would have been subject to the Corporate Transparency Act remain in a state of limbo.

Of course, if an anonymous entity claimed that BOI opponents are Putin lovers who want to hide terrorist activities, those same opponents would want to know who is saying that about them. What’s good for me isn’t good for thee…

Oh BOI Again, Subject to Change

On December 23, 2024, we learned that Beneficial Ownership Information (BOI) reporting WOULD be required, albeit later than originally planned.

The next day, December 24, I wrote a Bredemarket blog post about this.

Two days later, December 26, my December 24 blog post was already outdated. 

“On December 26, 2024, a different panel from the Fifth Circuit issued an order that vacated the court’s prior December 23 order granting a stay of the preliminary injunction. As a result, the injunction issued in Texas Top Cop Shop remains in effect nationwide and reporting companies are currently not required to file beneficial ownership information with FinCEN.”

The notice above was published on January 4.

Check back on January 6.