21 Attorneys General Sue Trump Administration Over Corporate Ownership Rule
A coalition of 21 attorneys general from 20 states and the District of Columbia sued to block a Trump administration rule that exempts nearly all companies from federal beneficial-ownership reporting requirements.
A coalition of 21 attorneys general sued the Trump administration on Tuesday, October 27, 2026, seeking to block a Treasury Department rule that sharply narrows which companies must disclose their beneficial owners to the federal government. The case challenges the administration’s implementation of the Corporate Transparency Act, a 2021 anti-money-laundering law.
New York Attorney General Letitia James announced the action with attorneys general from 19 states and the District of Columbia. Reuters separately reported the filing. The complaint names Treasury Secretary Scott Bessent and other federal officials and asks a court to declare the rule unlawful and stop it from being implemented.
What the challenged rule does
Congress enacted the Corporate Transparency Act to require many domestic and foreign entities to provide identifying information about the people who ultimately own or control them. The reports go to the Treasury Department’s Financial Crimes Enforcement Network, known as FinCEN, and are not a public corporate registry. Authorized law-enforcement and other government users may obtain the information under statutory controls.
In March 2025, FinCEN issued an interim final rule that removed reporting requirements for U.S.-created companies and U.S. persons. The remaining requirements apply to certain entities formed under foreign law and registered to do business in the United States. FinCEN said at the time that the change reflected the administration’s effort to reduce regulatory burdens on American taxpayers and small businesses.
The suing attorneys general say the exemption goes far beyond the authority Congress gave Treasury. Their complaint alleges that more than 99.9% of entities that otherwise would have been covered are now exempt. They also challenge Treasury’s announced plan to delete information already submitted by companies that no longer have to report.
States argue the data supports investigations and tax enforcement
The coalition says beneficial-ownership records can help investigators trace money through anonymous shell companies in cases involving fraud, drug trafficking, money laundering and tax evasion. The states argue that removing most companies from the system deprives state and local law enforcement of a tool Congress intended them to use.
Those assertions are allegations in a civil complaint, not findings by the court. The lawsuit argues that the rule conflicts with the text and purpose of the Corporate Transparency Act, violates the Administrative Procedure Act and intrudes on Congress’s legislative authority. The administration will have an opportunity to respond, and the filing itself does not suspend the rule.
Who joined the case
Along with New York, the coalition includes Arizona, California, Colorado, Delaware, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, North Carolina, Oregon, Rhode Island, Virginia, Washington and Wisconsin, plus the District of Columbia. The attorneys general are asking for declaratory and injunctive relief rather than monetary damages.
The dispute puts the administration’s business-deregulation policy against a congressionally created financial-transparency program. The key legal question is not whether anonymous companies can be misused, but whether Treasury had statutory authority to exempt domestic companies and U.S. owners on the scale described in the rule. The court will weigh the statutory text, the agency’s explanation and the states’ asserted harms. Until a court rules or issues interim relief, the narrowed FinCEN requirements remain the operative federal policy.
Sources and image credit
- Reuters — Trump administration sued over rollback of corporate ownership reporting rules
- New York attorney general — coalition announcement and participating jurisdictions
- Court filing — Oregon et al. v. Scott Bessent et al. complaint
- FinCEN — March 2025 beneficial-ownership reporting rule announcement
- Image: U.S. Treasury Department building on Wikimedia Commons
- Original full-resolution image
- Image creator: 颐园居