The top Democrat on the House Financial Services Committee, Maxine Waters of California, and four senior Senate Democrats are urging an appeals court to preserve a new law that requires small businesses, including farms, to disclose their ownership to the federal government.
Sens. Elizabeth Warren of Massachusetts, Sheldon Whitehouse of Rhode Island, Ron Wyden of Oregon, and Jack Reed of Rhode Island filed a “friend of the court” brief with the 11th U.S. Circuit of Appeals supporting the Corporate Transparency Act, which is intended to combat money laundering.
The law, which a federal judge in Alabama ruled unconstitutional last month, requires businesses to file reports on their ownership with the Financial Crimes Reporting Network, a Treasury Department agency known as FinCEN.
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Farms operated as LLCs, including those with a single member, have to file the reports, as well as limited partnerships and S or C corporations.
The Democratic lawmakers said in their brief that Congress “determined that requiring disclosure of beneficial ownership of legal entities, including shell companies, is crucial to combat money laundering and its attendant national security and law enforcement risks. The CTA is a garden-variety, valid exercise of Congress’s core Article I authorities, supported by extensive congressional factfinding and a robust legislative record.”
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