In our last update, we reported that despite the Supreme Court staying the nationwide injunction against FinCEN’s enforcement of the CTA in one Texas case, a nationwide stay of the Reporting Rule granted by a federal judge in the Eastern District in Smith v. United States Department of Treasury (6:24-cv-00336) remained in effect.
On February 15, 2025, FinCEN filed a notice of appeal in Smith and requested a stay of the injunction pending appeal, which the district court granted in an order issued on February 17, 2025. As a result, the CTA is once again enforceable while the court continues to assess the merits of this lawsuit.
FinCEN published guidance that for the vast majority of Reporting Companies, the new deadline to file is now March 21, 2025. Further, FinCEN stated it would assess its options to modify deadlines and/or reporting requirements.
Despite the Smith court’s ruling and FinCEN’s guidance, on February 10, 2025, the House unanimously passed the “Protect Small Businesses from Excessive Paperwork Act of 2025.” The bill includes a one-year delay in compliance with the CTA’s filing requirements for businesses formed before January 1, 2024, extending the filing deadline until January 1, 2026. The bill has not yet passed, so only time will tell as to whether deadlines will be extended yet again.
McGuireWoods will continue to monitor developments and publish updates as these cases proceed. Our team stands ready to assist. For questions about the CTA or anti-money laundering (AML) compliance generally, including customer due diligence and beneficial ownership rules, contact the authors of this article or another member of the McGuireWoods’ Financial Services & Securities Enforcement, Government Investigations & White Collar Litigation, Healthcare, Tax & Employment Benefits, or Corporate & Private Equity teams.