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On Monday, February 10^th, the House unanimously passed the “Protect Small Businesses from Excessive Paperwork Act of 2025.” The bill includes a one-year delay in compliance with the CTA’s filing requirements for businesses formed before January 1, 2024.

In the meantime, FinCEN has filed a Notice of Appeal of the Smith case (which had imposed a nationwide injunction against enforcement of the Beneficial Ownership filing requirements of the CTA), and requested a “stay” of the injunction. Imposition of a stay by the Appeals Court would effectively undo the injunction and force companies to file their Beneficial Ownership Information Reports with FinCEN. However, FinCEN stated that if the stay was granted, FinCEN would allow at least 30 days for businesses to comply.

If the appeal follows the same path as the other case, the 5^th Circuit appeals court will deny the stay, the government will appeal, and the Supreme Court will grant the stay pending a decision by the justices. Notwithstanding the Supreme Court’s position (already striking a nationwide injunction that barred enforcement of the CTA), the political momentum appears to be shifting against the more onerous requirements of the Act. We would not be surprised if the Senate passed the House bill by a similar margin and the President signed it into law.

New York City legislators have not been idle. The NYC “Fair Chance” Housing Law took effect on January 1, 2025 prohibiting most housing providers from discriminating against both renters and purchasers based on the applicant’s arrest records, convictions and other criminal history.

The Fair Chance Housing Law amends the Human Rights Law by limiting the types of records that “covered” housing providers may request and consider from applicants. The law applies to nearly every housing provider in NYC with three or more units for rental or sale, including cooperative and condominium sales and (proprietary) leases.

Commencing on January 1 of this year, all brokers, licensed salespeople, housing owners, property managers and all individuals with authority to approve or deny a rental or sale of housing (including cooperative and condominium boards and managing agents) are prohibited from treating applicants differently or changing the terms of a sale or lease because of the applicant’s criminal history. (It appears that for purposes of the Act, the decision of a condominium whether to exercise a “right of first refusal” also would be deemed subject to the Act.)

Housing providers who choose to perform criminal background checks must first review the application, determine that it meets the general eligibility standards and make a conditional offer to the applicant. A housing provider may not ask an applicant whether they have a criminal history either orally or in writing, and may not search for criminal history in publicly available records including websites, until a conditional offer is made to the applicant and the applicant is provided with a copy of the Fair Chance Housing Notice of Rights.

The housing provider may then perform a criminal background search, but that search may report only: (a) convictions that require registration on a sex offense registry at the time of the background check, regardless of when the conviction occurred, (b) felony convictions where the actual release date or sentencing date (if no jail time) occurred within the last 5 years or (c) misdemeanor convictions where the actual release date or sentencing date (if no jail time) occurred within the last 3 years.

Housing providers must ensure that the scope of the background check they choose to run does not exceed the limited types of convictions permitted by the statute. If the housing provider then wishes to revoke a conditional offer, it must provide a copy of the criminal history it received to the applicant, explain in writing the reason behind the withdrawal of the conditional offer, and notify the applicant that they have 5 days to point out any errors or inaccuracies or to show that the housing provider inappropriately considered a part of the criminal history and to provide supporting information that explains their history.

Additional links:

The Fair Chance Housing Notice of Rights can be found at:

The Fair Chance Housing Notice

Helpful Questions and Answers about the law can be found at:

Fair Chance Housing Campaign

Earlier today we reported that the Injunction in the “Top Shop” case (which the Government had appealed to the Supreme Court) had been overturned by the court. We expected FinCEN to reinstate the filing deadlines today.

We had been ignoring a parallel case, Samantha Smith and Robert Smith v. U.S. Department of the Treasury et. al. (U.S. District Court, E.D. Texas), which the Government had not appealed. The court in the Smith case also had deemed the CTA to be unconstitutional and also issued an injunction against enforcement of the CTA against the plaintiffs. However, we had interpreted the concurrent temporary stay of the “Reporting Rule” (requiring the filing of Beneficial Ownership Information by companies) granted by the District Court in the case, to apply only to the plaintiffs in that case as well. See the full case HERE.

 Apparently FinCEN disagrees. This morning, FinCEN stated:

“On January 23, 2025, the Supreme Court granted the government’s motion to stay a nationwide injunction issued by a federal judge in Texas (Texas Top Cop Shop, Inc. v. McHenry—formerly, Texas Top Cop Shop v. Garland). As a separate nationwide order issued by a different federal judge in Texas (Smith v. U.S. Department of the Treasury) still remains in place, reporting companies are not currently required to file beneficial ownership information with FinCEN despite the Supreme Court’s action in Texas Top Cop Shop. Reporting companies also are not subject to liability if they fail to file this information while the Smith order remains in force. However, reporting companies may continue to voluntarily submit beneficial ownership information reports.” [Emphasis added.]

As a result, compliance with the Reporting Rules in the CTA remains voluntary. We still recommend that at a minimum, companies send their reporting information to any third party filing agents whom they have retained. That way, if the Smith injunction is similarly overturned, you will be ready to make the necessary filing. But as of today, we are countermanding our instructions from yesterday’s report. Compliance with the Reporting Rules in the CTA remains voluntary.

Beginning January 1, 2025, New York employers must provide employees with 20 hours of paid leave annually for prenatal care appointments or other pregnancy-related needs. The key provisions of the new law are as follows:

• Every employer, regardless of the number of employees, is required to provide this benefit.
• Leave can be used for healthcare services received by an employee during or related to their pregnancy, including physical examinations, medical procedures, monitoring and testing, and consultations with a healthcare provider.
• Leave may be taken in hourly increments, and benefits must be paid in hourly installments.
• Employees will be compensated at their regular rate of pay or the applicable minimum wage, whichever is greater.
• Employers are not required to pay employees for unused paid prenatal leave upon an employee’s termination, resignation, retirement, or other separation from employment.
• Employees are entitled to the full 20 hours of leave immediately, regardless of their length of employment, and are not required to accrue leave hours to access this benefit.

Employers should update their policies accordingly and notify employees of the new law.