AG Rayfield and State Coalition Sue to Save Corporate Transparency Act

Oregon Leads 21-State Lawsuit Challenging FinCEN Rule Change

Federal officials have effectively shuttered a primary federal mechanism designed to expose money laundering, tax evasion, and organized crime.

The legal challenge centers on the Corporate Transparency Act, a bipartisan measure passed by Congress in 2021 to require businesses to disclose their true beneficial owners to the federal government. For investigators trying to trace dirty money, anonymous shell companies have long served as financial opaque curtains. By stripping away ownership reporting requirements, the U.S. Treasury Department’s Financial Crimes Enforcement Network, known as FinCEN, has rendered the database functionally useless for state and federal law enforcement.

Oregon Sues FinCEN over Rule Violations and Database Purge

The lawsuit, designated as State of Oregon v. Bessent, argues that the administration’s actions violate both the Corporate Transparency Act and the Administrative Procedure Act. State prosecutors assert that FinCEN enacted the August 2026 rule without required legal steps, failed to provide a reasonable explanation, and omitted necessary consultations with the Secretary of Homeland Security and the U.S. Attorney General.

The situation escalated further when FinCEN announced plans to permanently delete ownership records already collected inside the database. State officials warn that this purge will destroy valuable evidence tied to unsolved financial crimes.

The federal administration has given a green light to all sorts of criminals. In gutting the Corporate Transparency Act, the administration is welcoming organized crime, international money laundering, corruption, and tax evasion—and allowing it to happen right under our noses, said Attorney General Dan Rayfield.

Congress originally designed the database to provide a centralized registry that state and federal investigators could access to follow illicit financial flows, trace stolen assets, and uncover bribes. The plaintiff states are asking the federal court to invalidate FinCEN’s exemption rule and order the Treasury Department to maintain and continue collecting beneficial ownership data.

Participating States in the Coalition

Alongside Oregon Attorney General Dan Rayfield, Illinois Attorney General Kwame Raoul is co-leading the litigation. The broader coalition includes the attorneys general of Arizona, California, Colorado, Delaware, Washington, DC, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Rhode Island, Virginia, Washington, and Wisconsin.

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