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Treasury Rule Limits Anti-Money Laundering Requirements under Corporate Transparency Act

Anti Money Laundering

Business Honor
27 March, 2025

New Anti-Money Laundering rule limits Corporate Transparency Act, excluding domestic businesses from ownership reporting.

A new rule announced by the U.S. Treasury Department's financial crimes unit on Wednesday will restrict a crucial aspect of the 2021 Corporate Transparency Act, a bill designed to combat illicit funding.

According to a notification in the Federal Register, the new Financial Crimes Enforcement Network, or FinCEN, rule will take effect on Wednesday, while the unit is still soliciting public feedback on the change. Domestic businesses are not required to give the government information about beneficial ownership.

The action is the most recent attempt to limit anti-corruption initiatives by the Republican-led government of President Donald Trump. Earlier this month, the Treasury Department announced that it would not impose any penalties on domestic reporting businesses or U.S. persons under the 2021 statute.

As part of an attempt by lawmakers and the Treasury Department under former President Joe Biden to combat corruption and money laundering, FinCEN previously outlined a plan to mandate that certain corporations provide beneficial ownership data.

Under the new rule, foreign reporting businesses will still be required to submit beneficiary ownership information. According to the registration notification, most reporting units had to file by March 21.

For the benefit of small businesses and diligent American taxpayers, the U.S. Treasury Minister Scott Bessent believes that complex regulations must be simplified. A person with a majority of controlling ownership or a 25% or greater ownership holding in the business is considered a beneficiary owner. The unit is asking for public input on the legislation by May 27.