Freidel brothers create software startup to address federal compliance regulations
The Freidel family never had a shortage of curious minds and innovative ideas.
The 10 siblings, seven boys, and three girls, were always thinking of ways to create customers and improve the lives of their neighbors.
“We would put up tables at the end of our driveway and make all kinds of crafts and sell them – anything we could do to get a customer, we would do it,” said Paul Freidel, the second oldest.
That entrepreneurial spirit, combined with a strong work ethic instilled in them by their parents, continued long after they left their western Chicago suburb.
“We certainly learned the value of hard work and education,” said Paul, who graduated with his bachelor’s degree and took the CPA exam with a top 50 score at age 17.
Paul moved to Rapid City eight years ago with his wife Rebecca and eight kids after visiting the Black Hills during a family trip to Central Iowa. “We just fell in love with the area. This is a paradise with all the outdoor opportunities and outdoor spaces.”
It also provided a supportive business environment for Paul to expand his accounting firm, Freidel & Associates, LLC, and create his newest venture, a software startup he founded with his younger brother Tim.
Secure Compliance: A New Venture
In Spring 2023, Paul and Tim, an information technology expert who lives in Chicago, started Secure Compliance, a software program that helps professionals and business owners comply with the federal Corporate Transparency Act (CTA). Paul and Tim’s entrepreneurial spirit and foresight positioned Secure Compliance at the forefront of a crucial market niche.
Enacted in January 2021, the CTA requires most companies doing business in the United States to report information about the individuals who own or control them.
“This is the brainchild of my brother and I. We saw this regulation from FinCEN coming down the pike and knew it was going to be a compliance headache,” Paul said.
The U.S. Department of Treasury’s Financial Crimes Enforcement Network (FinCEN) collects and analyzes financial information to fight money laundering and other crimes. Until the CTA, the United States was one of the few, if not only developed countries that did not have beneficial ownership reporting. “We are late to the ballgame and there was a lot of pressure that we may lose our international banking system if we didn’t have beneficial ownership reporting,” Paul said.
The Importance of Compliance
Despite being enacted in 2021, this is the first year beneficial ownership information reports must be filed.
“It was kind of a sleeper,” Paul said of the legislation. “The effective date was far enough in the future that people weren’t really paying attention. The date kept getting closer and closer and most people didn’t even know about it.”
All companies created or registered before January 1, 2024, have until the end of this year to comply or face steep fines. Companies created or registered this year have 90 calendar days after the company’s creation to register.
The legislation deadline affects nearly 33 million entities created before this year, Paul said.
Secure Compliance’s Solution
With Tim’s technical background and Paul’s decades of accounting experience, the duo knew they had an opportunity to create something to make the lives of professionals easier.
“We like to say what we do is built by professionals for professionals, and it really is. We know how the business world works, and we know what people need,” Paul said. “We are bringing that as our special sauce when creating these products.”
Secure Compliance’s main focus is providing the technology for professionals like CPAs and attorneys to help their clients comply with CTA. “We work with them, and they do the BOI filings on behalf of their clients,” Paul said, adding the software also provides an easy platform to make any modifications or updates to ownership.
The hope is to expand the patent-pending software to address other impending regulations. “We would love to continue to build it out,” Paul said of Secure Compliance. “We have a lot of ideas. Rapid City has a lot of opportunities for growth, so we are very excited about that. There are a lot of people that are moving here that are very talented and bring a lot to the business community and the DLAB provides a fabulous space and encouragement for tech startups like ours.”
This story was originally published in the October 2024 issue of Elevate Magazine.
