Warren and Waters Launch Probe into Treasury Secretary’s Decision to Gut Corporate Transparency Act in Light of New Warnings

Warren and Waters Launch Probe into Treasury Secretary's Decision to Gut Corporate Transparency Act in Light of New Warnings

Lawmakers will continue oversight of Treasury's handling of the bipartisan Corporate Transparency Act in the weeks ahead.

"As a recent headline in the Daily Caller highlighted, 'Trump Admin May Have Accidentally Empowered Cartels To Flood America With Fentanyl, Republican Legal Experts Warn.'"

"It appears that you are implementing a policy directed by the so-called Department of Government Efficiency (DOGE) that facilitates fraud in federal programs..."

Text of Letter (PDF)

Washington, D.C. - United States Senator Elizabeth Warren (D-Mass.), Ranking Member of the Senate Banking, Housing and Urban Affairs Committee, and Congresswoman Maxine Waters (D-Calif.), Ranking Member of the House Financial Services Committee, sent a letter to Treasury Secretary Scott Bessent pressing him on Treasury's decision to ignore the bipartisan Corporate Transparency Act (CTA) despite new warnings that failing to address shell companies is helping fraudsters steal taxpayer funds from U.S. federal government programs and helping drug cartels profit from selling fentanyl.

"Your decision to gut the law has caused growing alarm among law enforcement, inspectors general looking to fight fraud in U.S. government programs, and experts across the political spectrum that you are making it easier for criminals to take advantage of the financial system," wrote the lawmakers. "Treasury has taken this approach despite ample unclassified evidence that criminals and foreign adversaries use shell companies or opaque corporate structures in the United States. This includes Sinaloa cartel operatives, Iranian sanctions evaders, and those stealing technology for China's military."

In the letter, Warren and Waters cite warnings from the Financial Action Task Force, the Government Accountability Office, the National Narcotic Officers' Associations' Coalition, and experts across the political spectrum that rolling back CTA enforcement facilitates money laundering, federal program fraud, fentanyl trafficking, and other illicit activity.

The lawmakers are seeking answers on whether Treasury has analyzed the national security consequences of refusing to enforce the law, and whether Secretary Bessent disagrees with law enforcement experts across Republican and Democratic administrations who have underscored the importance of cracking down on the use of anonymous shell companies in the United States to obscure illicit activity. This latest letter follows an April inquiry led by Warren and Waters that similarly warned Treasury that "bad actors will exploit the financial system" if the law is not enforced. The lawmakers will continue oversight of Treasury's handling of the Corporate Transparency Act in the weeks ahead.

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