Dec 4 (Reuters) - "A federal judge in Texas has issued a nationwide injunction blocking the enforcement of an anti-money laundering law that requires corporate entities to disclose to the U.S. Treasury Department the identities of their real beneficial owners.
U.S. District Judge Amos Mazzant in Sherman, Texas, on Tuesday sided, opens new tab with the National Federation Of Independent Business and several small businesses and non-profits by concluding the 2021 Corporate Transparency Act was likely unconstitutional.
The decision marked the second time a judge has deemed the law unconstitutional. An Alabama federal judge reached a similar conclusion in March in response to a separate challenge to the law but issued a narrower injunction, blocking its enforcement as applied to the parties before him, including the National Small Business Association.
Mazzant said the law was an "unprecedented" attempt by the federal government to legislate in an area traditionally left to the states by monitoring companies created pursuant to state law and ending the anonymity various states provide in the formation of corporations.
Supporters of the legislation said it was designed to address the country's growing popularity as a venue for criminals to launder illicit funds by setting up entities like limited liability companies under state laws without disclosing their involvement."
