Treasury Halts Enforcement of Small Business Rule

The US Treasury Department announced it would not enforce a Biden-era rule requiring small businesses to register ownership information. The regulation aimed to combat money laundering and shell company formation. Despite controversy and pending legal challenges, the rule remains in place, but penalties will not be enforced.

The US Treasury Department has decided not to enforce a rule introduced during the Biden administration that was designed to tackle money laundering and shell company creation. The controversial rule required small businesses to register beneficial ownership information with the government.

Previously, the Treasury aimed to create a sizable database containing personal information about business owners, as part of efforts to curb illicit financial activities. However, enforcement will not proceed due to legal challenges and criticisms, especially regarding privacy and the redundancy of such regulations.

Officials, including former Treasury Secretary Janet Yellen, had assured that the rule's regulatory burden would be minimal, costing approximately $85 per business while aiding law enforcement. President Trump's praise and ongoing litigation highlight continuing division on the issue.

(With inputs from agencies.)