Couple important developments to report on the Corporate Transparency Act front.
First, around 90 members of Congress yesterday sent a letter to Treasury Secretary Scott Bessent urging that the CTA database be purged entirely. It makes clear:
As Congress works to provide long-term relief from the CTA, we urge the Department of Treasury and FinCEN to promulgate a final rule that exempts U.S. businesses from the CTA. We also acknowledge that millions of U.S. small businesses have already registered with FinCEN. This data must be immediately destroyed to protect the privacy of small business owners.
The letter underscores the reality that while FinCEN has pulled back on requiring new filings by domestic entities, the damage won’t be undone until existing data is wiped clean. Otherwise, Main Street businesses will remain exposed to risks they never should have faced in the first place.
By way of brief background, the Treasury Department earlier this year made the critical decision to limit the CTA’s reach to foreign entities only. That change was both necessary and overdue. Under the original statute, 32 million American businesses were required to file intrusive beneficial ownership reports or face felony charges. These are family-owned companies, community employers, and entrepreneurs who never should have been swept into a regime meant to target terrorists and international criminals.
Yet before Treasury corrected course, millions of small business entities had already filed reports with FinCEN – an extraordinary compliance burden imposed under threat of criminal penalties. That database still exists today, filled with personal information of law-abiding Main Street businesses. Protecting those businesses means taking the next logical step: purging the database.
The House Appropriations Committee also recently took up this issue head on. In the report accompanying its FY2026 FSGG bill, the Committee included new language directing FinCEN to provide Congress with a report within 90 days on the status of the beneficial ownership information already collected:
Because more than 16 million domestic small business entities submitted beneficial ownership information to FinCEN prior to its decision to require only foreign entity reporting, the Committee is concerned about the use of the existing beneficial ownership information.
That language sends a clear signal: now that they are are rightly exempt from the CTA, the information FinCEN collected from 16 million Main Street businesses should not be left sitting on a server waiting for a cybercriminal to strike.
The renewed focus on the existing database is exactly where the debate belongs. It’s one thing to win prospective relief; it’s another to ensure that the millions who already complied under threat of penalties are no longer left vulnerable.
So progress on two fronts, with a broad coalition of elected officials calling for a full purge. Now Treasury needs to act. Deleting the database is not just good policy, it’s common sense. If Main Street businesses no longer need to file, then their personal information should not remain in government hands.