Trump’s Treasury Department neuters anti-money-laundering rule

So, remember how just a couple weeks ago we told you you’d need to file your Beneficial Ownership Information (BOI) to FinCEN by March 21?

Yeah, um, about that…

In the latest volley in the ongoing ping-pong match over the Corporate Transparency Act, the Treasury Department announced on March 2 that it wouldn’t enforce fines or penalties against companies that failed to file their BOI. It also said it would propose changes to the BOI reporting rule to make it applicable to foreign companies only.

The change is reflective of the second Trump administration’s emphasis on deregulation. Treasury Secretary Scott Bessent called the change “part of President Trump’s bold agenda to unleash American prosperity by reining in burdensome regulations, in particular for small businesses that are the backbone of the American economy.”

Under the CTA, an anti-money-laundering measure Congress passed in 2021, approximately 32 million small and medium sized businesses were required to file their BOI with FinCEN. (Smaller companies were targeted because shell companies, which the CTA strove to limit, typically have very few employees, the AP noted.) Some critics charged that the requirement would prove burdensome for small businesses to comply with, and the AICPA and state accounting societies requested that the filing deadlines be extended.

The Financial Accountability and Corporate Transparency Coalition (FACT) argued that softening the CTA could make it easier for bad actors to operate in the US. “It is a basic principle that US law enforcement and intelligence agencies should be able to check who is using US shell companies to move money within and across our own borders,” Nate Sibley, fellow and director of Hudson Institute’s Kleptocracy Initiative, said in a FACT press release. “This action weakens the Trump Administration’s ability to investigate cartel finances and target the profit incentives driving the deadly fentanyl and human trafficking trade across the southern border.”

Many of the Trump administration’s actions have faced legal challenges, so this may not be the last chapter in the BOI saga. Companies may want to have that information at the ready, just in case.