HARDI Signs Coalition Letter Urging Treasury to Protect Small Business Data

HARDI has joined more than 100 trade associations in urging the U.S. Department of the Treasury to take immediate action to protect small business owners from unnecessary privacy and cybersecurity risks created by the Corporate Transparency Act (CTA).

The coalition letter, led by the Main Street Employers Coalition, emphasizes that the CTA was never intended to become a long-term repository of sensitive personal information belonging to law-abiding American business owners.

Before Treasury narrowed the CTA’s scope, compliance was already widespread. According to the coalition letter, roughly 16 million domestic entities had already submitted ownership information. Even though domestic reporting is no longer required, the privacy and cybersecurity risks remain for those who already complied. Millions of small business owners’ sensitive data is still being retained, including names, home addresses, and passport or driver’s license numbers.

This has created a situation where small business owners are exposed despite no longer being subject to the reporting requirement. There is also no legitimate justification for continued retention, a concern that has already been raised by more than 90 members of Congress in recent months.

The letter urges Treasury to take two clear steps:

• Purge the CTA database of beneficial ownership information submitted by domestic entities that are no longer required to file, and

• Quickly finalize the rule that formally exempts U.S. businesses from the reporting requirement.

These actions would provide immediate relief and reduce the risk of unauthorized disclosure or cyber incidents involving sensitive personal information.

The coalition letter also points to the growing uncertainty surrounding the CTA in the courts, reinforcing why Treasury should act now rather than leaving small businesses in limbo. There are currently twelve federal cases challenging the validity of the CTA.

HARDI is proud to stand with a broad coalition of trade associations in calling for common-sense action that protects trade groups.

Questions?

If you have questions, please reach out to Alex Ayers.

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