A US federal appeals court has reinstated a nationwide preliminary injunction that pauses enforcement of the Corporate Transparency Act (CTA), which requires businesses to reveal their owners and officers. The ruling, made by the 5th Circuit Court of Appeals in December, means shell corporations may not be forced to disclose their true owners.
The CTA aims to combat financial crimes like money laundering and corruption by requiring companies to report beneficial ownership information to FinCEN. Passed in 2021, it went into effect on January 1, 2024. However, a federal district court earlier ordered the Act to be put on temporary hold, leading to conflicting rulings across the country.
If unregulated, shell corporations can use complex structures to hide behind environmental damage. This raises concerns about accountability and environmental exploitation. Satellites have captured images of significant deforestation in the Amazon Rainforest and untreated wastewater dumping into rivers like the Connecticut River.
The CTA’s impact on climate issues is still uncertain as its fate remains undecided. However, individuals can help by spreading awareness, supporting organizations that track environmental exploitation, and backing candidates who prioritize environmental rights.
Source: https://www.yahoo.com/news/federal-appeals-court-makes-controversial-110021374.html