Senators Question Treasury’s Move to Limit CTA to Foreign Firms
Sens. Sheldon Whitehouse, D-R.I., and Chuck Grassley, R-Iowa, asked the Treasury Department on March 10 to provide the legal basis for its decision to exclude U.S. citizens and companies from implementation of the Corporate Transparency Act.
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In a letter to Treasury Secretary Scott Bessent, the senators said they also want to know how the department plans to meet the policy goals of the CTA, which was enacted in 2021 to help the government prevent sanctioned parties and others from hiding money or property in the U.S.
“We encourage you to fully implement the CTA so that law enforcement agencies around the country have access to information necessary to prevent human trafficking, terrorist financing, border smuggling, drug distribution, and many other categories of criminal activity,” the senators wrote. They requested a response by March 12.
The CTA was to be carried out through the beneficial ownership information (BOI) reporting rule, which calls for companies to submit information to the Financial Crimes Enforcement Network on who owns and controls them. But Treasury announced March 2 that as part of the Trump administration’s agenda to reduce “burdensome regulations,” it won't enforce penalties under the current BOI rule and will narrow the scope of the rule so it applies only to foreign companies (see 2503030042).
BOI critics have said the rule is more complicated than Congress envisioned, and many small businesses are unaware of the reporting requirements (see 2402140044).