A quiet dismantling is underway in the fight against financial crime—one that strikes at the heart of a reform meant to pull back the curtain on who truly owns and controls American companies.
The U.S. Treasury Department’s Financial Crimes Enforcement Network, or FinCEN, has announced plans to delete the beneficial ownership information of millions of American companies from its database.
This decision, revealed by Director Andrea Gacki during a congressional hearing on September 9, is not an isolated act.
It is the latest step in a systematic retreat from the Corporate Transparency Act, a bipartisan 2021 law designed to combat money laundering by ending the anonymity of shell companies.
This reversal began in earnest in March of this year, when the Treasury Department issued an interim final rule exempting all U.S. businesses from the requirement to report their true owners.
“This is a victory for common sense,” said U.S. Secretary of the Treasury Scott Bessent in a March 2, 2025, press release. “Today’s action is 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.”
Critics say it was a victory for corruption, as a chorus of voices erupted from Congress, law enforcement, national security, anti-corruption, small business, and other communities in submitting official comments condemning the Treasury Department’s evisceration of the Corporate Transparency Act (CTA), the most significant U.S. anti-money laundering reform in a generation.
The comments submitted in response to the Treasury Department’s action said limiting the scope of the CTA effectively nullified the statute in defiance of congressional intent.
The planned data deletion now signals an intention to make this retreat permanent, effectively closing the book on a database once celebrated as a landmark step forward. The consequence is a stark double standard: once the rule is finalized, only foreign businesses operating in the U.S. will be required to disclose their ownership, while domestic companies will return to the shadows.
This pivot comes just five years after the FinCEN Files investigation—a global journalistic exposé that revealed how corrupt regimes, drug cartels, and other criminals were able to move dirty money through the U.S. financial system with ease, shielded by layers of corporate secrecy.
The public outcry that followed those revelations was the catalyst for the Corporate Transparency Act. The law was passed to ensure that law enforcement would no longer be flying blind.
As Gary Kalman of Transparency International U.S. starkly put it, “Without beneficial ownership information, investigations are useless.”
The move to destroy data has drawn fierce criticism from transparency advocates and lawmakers.
Ian Gary of the FACT Coalition called the potential destruction of data “doubling down on Treasury’s unlawful gutting of this statute.” The administration defends its actions as a relief for hardworking American small businesses, with Treasury Secretary Scott Bessent labeling the rollback a “victory for common sense.”
Senators Sheldon Whitehouse and Chuck Grassley also urged the Treasury Department to rescind the rule, and explained that “The rule not only contravenes Congress’s intent as reflected in the CTA’s plain text and legislative history, but it also undermines the operation of a law Congress deemed essential to protecting Americans’ national security and public safety.”
The Trump administration’s justification rings hollow to those who track the flow of illicit funds.
They point to FinCEN’s own reporting, which has highlighted how domestic shell companies are actively used by Chinese money laundering networks to purchase real estate.
In a telling moment during the September hearing, Gacki herself conceded that “there are still instances where domestic shell companies can be leveraged in financial crime.”
This admission highlights a profound contradiction: the very agency tasked with safeguarding the financial system is voluntarily disarming in the face of a known threat.
The planned deletion of this database does not just erase ones and zeros from a government server—it severs a vital link that investigators were just beginning to use.
Before the reporting requirement was narrowed, a pilot program had already provided 100 federal agents with access to the system, who conducted nearly 1,700 searches. That demand from law enforcement now goes unanswered.
A tool that was painstakingly built to follow the money—to untangle the webs of ownership that shield criminals—is now being deliberately taken apart.
The door to anonymous corporate ownership in the United States, which had begun to creak shut, is being pushed wide open once again.