ASA Calls Upon the Treasury Department to Purge CTA Database

ASA, together with numerous Main Street business organizations, called on the Department of the Treasury to promptly remove all beneficial ownership information from the Corporate Transparency Act (CTA) database that was submitted by domestic entities no longer required to file. Cleaning out this database now will help prevent future data misuse or leaks.

Earlier this year, the Administration narrowed the CTA’s scope so that it only applies to foreign entities, offering much-needed relief to more than 32 million domestic businesses previously included in a system designed to pursue international money laundering and terrorism financing—not law-abiding American business owners.

Prior to this change, around 16 million domestic entities had already complied with the CTA’s reporting rules. As a result, sensitive personal details of these beneficial owners—such as names, addresses, and passport or driver’s license numbers—are stored in a database managed by the Financial Crimes Enforcement Network, putting them at ongoing risk of cybersecurity breaches and unauthorized disclosure.

The legal situation surrounding the CTA adds urgency to this request. There are currently twelve federal court cases disputing the CTA’s validity, including two district court rulings—_National Small Business United v. Yellen and Small Business Association of Michigan v. Yellen_—which found the CTA unconstitutional in the Western District of Michigan. Although the Eleventh Circuit reversed the NSBA ruling, the case is headed to the Supreme Court and constitutional issues remain unresolved.

Given these legal uncertainties and the fact that domestic businesses are no longer required to report under the CTA, keeping their data serves no valid government purpose.