Those that submitted beneficial ownership information before the filing requirement was narrowed earlier this year may be wondering about the fate of that information. The Financial Crimes Enforcement Network’s (FinCEN) director provided an update on Tuesday.
The Corporate Transparency Act, enacted in 2021, requires that certain entities report information about their beneficial owners to FinCEN. The CTA was intended to target shell corporations engaged in illicit activities – from money laundering to human and drug trafficking.
While reporting obligations initially applied broadly, in March, the Trump administration suspended enforcement against U.S. citizens and domestic entities. The administration did so via an interim final rule – but it has yet to issue a final rule or address the many comments received.
Fate of Filings
Beneficial ownership information reporting requirements were suspended after many entities had already filed. The Government Accountability Office said in a February 2025 report that over 6 million entities had filed as of October 29, 2024. But it estimated that over 32 million entities would have been required to file reports. It’s unclear just how many now-exempt entities filed in advance of the March rule.
Before the beneficial ownership information rule was narrowed, FinCEN embarked on a pilot program, providing select federal agencies with access to filed information. The GAO found that “four pilot agencies collectively provided 100 staff members access to FinCEN’s IT system for BOI, conducting nearly 1,700 searches as of October 29, 2024.” FACT Coalition Deputy Director Erica Hanichak noted this shows a clear demand amongst law enforcement for the information.
On Tuesday, FinCEN Director Andrea Gacki – speaking before the House Financial Services Subcommittee on National Security, Illicit Finance, and International Financial Institutions – shared that as her agency finalizes the reporting rule, it also intends to “delete any information that was filed that is no longer required to be filed.”
Gacki acknowledged a September 8 letter from subcommittee Chair Warren Davidson (R-OH) and 86 other lawmakers urging FinCEN to adopt a final rule with narrowed reporting requirements. In that letter, the lawmakers requested that previously filed data “be immediately destroyed to protect the privacy of small business owners.”
A ‘Gutted’ Rule
Gacki also shared that Treasury and FinCEN are “carefully reviewing” interim final rule comments to “see if any adjustments need to be made.” She expects the rule to be finalized “this calendar year.”
Subcommittee Ranking Member Joyce Beatty (D-OH) pushed Gacki on whether she still agreed that “domestic companies could present a money laundering risk.” Gacki conceded that “there are still instances where domestic shell companies can be leveraged in financial crime.”
However, Gacki noted that the Trump administration “has taken a look at the reporting structure and assessed that the burdens on small business fell too greatly.” She stressed there are “other sources of information that can help law enforcement” absent beneficial ownership information reporting.
That includes FinCEN’s Customer Due Diligence rule, which Gacki explained requires information collection when financial accounts are opened. “Financial transactions and financial accounts are usually critical to all forms of shell companies in the United States,” Gacki added.
Hanichak, however, said with the narrowed rule, “FinCEN is violating the intent of Congress and tying the hands of law enforcement, making it harder to protect our communities.” She told Checkpoint that “despite testimony Tuesday acknowledging that domestic companies present risk of financial crime, FinCEN is doubling down on its unlawful gutting of this bipartisan law by announcing its intention to erase disclosures already made to the database.”
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