I think compliance standards such as those laid out by FATF are being misrepresented in this discussion.
The concept of a UBO is not strictly attached to the 25% threshold in the way that many in this discussion are suggesting. 25% is the maximum threshold that should be used according to FATF guidance, not the threshold that should be used (it’s the least strict/comprehensive one). The actual threshold used is supposed to be established based on risk assessment and how security-critical the context is.
Guidance-Beneficial-Ownership-Legal-Persons.pdf.coredownload.pdf (page 18, paragraph 37)
Such a threshold should not exceed a maximum of 25%
Note that this is not just saying that any ownership share should not exceed 25%. It’s saying much more than that - that in riskier contexts the threshold should actually be lower, and that any ownership share should not exceed that lower threshold.
25% is largely arbitrary with respect to the IC and is not informed by the particular problem context. Instead, it’s the most relaxed threshold permissible by FATF standards (which are explicitly flexible with regard to applying lower thresholds based on perceived risks). I have not seen a thorough analysis of the risks sufficient to justify a 25% threshold being applied in the context of the IC. The IC necessitates deterministic decentralisation as a foundational requirement that everything else rests on.
If an auditor isn’t going to chase down and scrutinise minority shareholders, how can you be sure those minority share holders do not equate to the same person higher up the chain (who cumulatively therefore has more than just a minority share in terms of their sum total influence).
For argument’s sake (and as a simplification), someone owning 24.9% may be somewhat invisible. But that means they could conceivably own another 24.9% share via another ownership channel, and another and another.
The approach surely needs to work the other way around. 75% of the ownership shares of a node provider entity should need to be 100% accounted for and thoroughly vetted before an auditor should even consider ignoring a minority shareholder. Even then, how can you discount that remaining share actually belonging to one of the other minority shareholders?