Trump Administration Wipes Beneficial Ownership Database in Permanent Removal of Anti-Corruption Safeguards

The US Treasury has permanently scrapped the rule requiring American companies to disclose, who really owns them, and will delete the ownership records it has already collected.

The move, announced on Tuesday, dismantles the core of a law that its own supporters once described as the most important anti-corruption measure in a generation.

The Financial Crimes Enforcement Network, the Treasury bureau that tracks illicit money, finalised a rule ending the requirement that US firms report their beneficial owners, the individuals who ultimately control a company, and said it would erase the data submitted by American filers.

Supporters of the rollback call it relief for small businesses buried in paperwork; opponents, including law-enforcement groups and several senators, warn that it hands anonymous shell companies back to the criminals who use them.

What the Rule Required and What FinCEN Has Now Undone

The reporting requirement came from the Corporate Transparency Act, which Congress passed in 2021 as part of that year's defence spending bill.

It obliged most corporations and limited liability companies to tell FinCEN the names, dates of birth and other details of anyone owning at least 25 percent of a firm or exercising substantial control over it, with the information held in a secure database open only to law enforcement and, in limited circumstances, banks conducting due diligence.

Tuesday's final rule makes permanent a rollback the administration began in March 2025, when FinCEN stopped enforcing the law for domestic companies and issued an interim rule exempting them.

The new rule confirms that US companies and US persons no longer have to file, exempts Americans who helped foreign firms register in the country, and directs FinCEN to delete records it reasonably believes belong to US persons, identified through details such as a US passport or driving licence.

Foreign companies doing business in the United States must still report their foreign owners, so the framework is not gone entirely. What has been removed is the part that applied to Americans, which was also the part that covered the great majority of the entities the law was written to make transparent.

The Administration's Case for Cutting the Requirement

Treasury Secretary Scott Bessent framed the decision as a promised piece of deregulation. 'Today's action is a victory for common sense and American small businesses,' he said in the announcement, arguing that the administration was 'eliminating a burdensome reporting requirement for millions of law-abiding business owners without compromising our national security'.

Business groups that had fought the law welcomed the change. The National Federation of Independent Business, which sued in 2024 to block the Corporate Transparency Act, said the rule protected small firms from an intrusive mandate and required the destruction of personal data already handed over, while urging Congress to repeal the underlying law outright.

The requirement had long drawn objections from small-business owners who considered it duplicative and invasive, and from Republicans who cast it as federal overreach.

In April, the House Financial Services Committee voted 26 to 25 to advance a bill repealing the act, under the title the Repealing Big Brother Overreach Act, reflecting how the reporting rule had become a partisan flashpoint well before Treasury acted.

Why Anti-Corruption Groups Say the Reversal Is Dangerous

Critics focus on what the database was built to stop. Anonymous shell companies registered in the United States have for years been used by drug cartels, corrupt foreign officials, sanctions evaders and tax fraudsters to move and hide money, and the Corporate Transparency Act was meant to strip away that anonymity by recording the real people behind each entity.

Senator Elizabeth Warren called the repeal a 'gift to cartels, criminals and US adversaries that exploit shell companies to move millions through our financial system', and asked Bessent to reverse it and testify before the Senate Banking Committee.

Tom Malinowski, a former congressman who helped write the law, said deleting the ownership information the government had already gathered was, in his words, 'utterly crazy'.

There is a pointed irony in the reversal that opponents have been quick to note. Secretary of State Marco Rubio, then a senator, praised the Corporate Transparency Act in December 2020 as 'the most significant anti-corruption & money laundering law in decades', crediting it with forcing anonymous shell companies to disclose their true owners.

The rule that carried out that promise is the one his administration has now erased, and the records it produced are being deleted rather than archived, closing off information that took years to assemble.