In a controversial decision revealed today by a government agency, the U.S. Treasury Department announced its intention to refrain from enforcing a key anti-money laundering law that requires millions of business entities to disclose the identities of their true beneficial owners. The law in question, known as the Corporate Transparency Act, was introduced during the Biden administration but has faced opposition from the Trump administration, citing concerns about its impact on low-risk entities.
The Treasury Department clarified in a statement on Sunday that it would not impose any penalties under the act against American citizens or domestic reporting companies. The rationale behind this move, as explained by the department, is to show support for hard-working American taxpayers and small businesses. Moreover, the Treasury Department indicated its plan to issue a rule that would limit the application of the act to foreign reporting companies, thereby narrowing its scope.
Advocates of the Corporate Transparency Act argue that it was crafted to combat the increasing trend of criminals exploiting the United States as a hub for laundering illicit funds. The law has been a subject of numerous legal challenges since its inception.
This development marks a significant shift in the enforcement landscape of anti-money laundering regulations and has sparked debates among various stakeholders. Stay tuned for further updates on this evolving story.
**Source: Reuters, Reporting by David Ljunggren; Editing by Jamie Freed**
