The Inner Monologue

There are many ways to fight corruption.

You can prosecute bribery. You can follow suspicious money. You can expose shell companies. You can make it harder for criminals, oligarchs, politicians and their friends to hide behind corporations whose paperwork tells you everything except the one thing that actually matters:

Who owns it?

Or, if you’re the Trump administration, you can apparently decide that knowing who owns things was the problem.

Welcome to another episode of Making America Safe for People Who Prefer Their Financial Arrangements Unexplained.

In 2021, the United States enacted the Corporate Transparency Act. The basic idea was neither revolutionary nor particularly difficult to understand. Anonymous companies are useful for hiding money. If you’re going to create certain companies in America, the federal government should have a confidential record identifying the actual human beings behind them.

This wasn’t some public website where your neighbors could snoop through your finances. Beneficial-ownership information was protected, with access primarily intended for law enforcement, national-security purposes and carefully regulated financial uses. Congress built privacy restrictions, authentication requirements and audit trails into the system.

Why?

Because anonymous shell companies are extraordinarily useful when you don’t want people asking inconvenient questions about where money came from or where it went.

Congress identified exactly the sorts of problems you’d expect: money laundering, terrorism financing, tax fraud, trafficking, financial fraud and foreign corruption. A later bipartisan-CTA bill in Congress reiterated that hidden corporate ownership facilitates precisely those crimes.

Then Donald Trump returned to office.

And suddenly the federal government developed a passionate concern for protecting Americans from the unbearable oppression of telling the Financial Crimes Enforcement Network who owns their companies.

On March 21, 2025, Trump’s Treasury Department issued an interim final rule exempting all domestic companies from the Corporate Transparency Act’s beneficial-ownership reporting requirements. U.S. persons were also exempted from reporting as beneficial owners of covered foreign companies. FinCEN subsequently acknowledged that the change exempted millions of entities from reporting.

Think about that.

Congress spent years confronting the problem of anonymous American shell companies.

Congress passed a law to identify their real owners.

Then the executive branch effectively said:

Never mind.

And naturally, we’re told this is about regulatory burden.

Of course it is.

It’s remarkable how often transparency becomes an intolerable regulatory burden precisely when the regulation requires someone to explain who owns the money.

There was a legitimate argument that the original law swept too broadly. Small businesses complained about compliance costs and complexity. Opponents even introduced legislation with the wonderfully understated title “Repealing Big Brother Overreach Act.”

Fine.

Simplify the forms.

Raise thresholds.

Exempt genuinely low-risk businesses.

Give mom-and-pop companies more time.

Reduce penalties for innocent mistakes.

There were a dozen ways to reduce the burden without demolishing the central principle that investigators should eventually be able to determine which human being is hiding behind an American shell company.

Instead, Treasury exempted domestic companies wholesale.

And here’s where this goes from questionable policy to something Americans should find genuinely shameful.

Law enforcement actually wanted this information.

Support for beneficial-ownership reporting included 42 state attorneys general, the Fraternal Order of Police and the National District Attorneys Association. After Treasury issued its rule, the NDAA warned that it threatened to deny investigators information they need to pursue illegitimate business fronts threatening national security and public safety.

So please spare us the fiction that this is merely government finally discovering the courage to stand up to paperwork.

The people whose job it is to investigate financial crime said the information was useful.

Congress decided the information was useful.

The federal government spent years constructing a system to collect it.

And Trump’s executive branch made the information disappear for millions of American entities.

That doesn’t prove Donald Trump personally designed this policy to facilitate corruption.

We should be precise about that.

But you don’t have to intend corruption to make corruption easier.

Remove the streetlights and you haven’t legalized burglary.

Eliminate auditing and you haven’t legalized embezzlement.

Stop recording corporate ownership and you haven’t legalized money laundering.

You’ve simply made life a little more comfortable for the people doing it.

And this administration deserves to be judged not merely by whether any individual decision can be given an innocent explanation, but by the institutional environment its decisions create.

Corruption thrives in darkness.

It thrives where ownership is obscure.

It thrives where conflicts of interest are difficult to trace.

It thrives where money can move through layers of corporations until investigators spend months determining that Prairie Holdings LLC is owned by Freedom Investments LLC, which is controlled by Liberty Management LLC, whose actual owner is—

Well.

Wouldn’t you like to know?

That was the point.

Transparency isn’t based on the assumption that every business owner is a criminal. Bank records aren’t based on the assumption that every depositor is laundering money. Financial audits don’t mean every accountant is an embezzler.

We maintain records because accountability requires records.

And there is something particularly perverse about the United States lecturing the rest of the world about kleptocracy while deliberately weakening one of the tools designed to prevent America from becoming a convenient financial hiding place for kleptocrats.

Transparency International US warned Congress that Treasury’s rule could make the United States more attractive to foreign criminals: instead of registering a foreign corporation here and becoming subject to reporting requirements, a bad actor could simply establish a domestic American entity that is exempt.

That’s not draining the swamp.

That’s installing privacy fencing around it.

Perhaps every administration occasionally adopts a policy that unintentionally makes corruption easier. Government is enormous. Regulations have consequences nobody anticipates.

But when an administration repeatedly asks us to believe that transparency is burdensome, oversight is persecution, disclosure is unnecessary and accountability is bureaucracy, eventually we should stop evaluating each tree and notice the forest.

A government genuinely hostile to corruption should make corrupt transactions harder to conceal.

That’s a remarkably low bar.

The Trump administration managed to walk underneath it.

The scandal here isn’t that Treasury has endorsed corruption.

It hasn’t.

The scandal is almost more embarrassing:

America identified a vulnerability that criminals and corrupt officials could exploit. Congress passed a law to close it. The government built the machinery to close it. And then Trump’s executive branch deliberately opened it again.

If your goal is honest government and clean financial markets, that’s indefensible.

If your goal is reducing paperwork at almost any cost, congratulations.

And if your goal is hiding who really owns the company receiving the money?

Well.

Your paperwork just got a whole lot easier.