Controversial law driving up cost of your HOA fee and it may be heading to the Supreme Court

A bubbling legal battle over a federal anti-fraud law has sparked worries from homeowners association advocates that they could be newly buried in bureaucratic red tape — and face increased costs.Originally designed to deter fraud and abuse in businesses entities, the Corporate Transparency Act imposes new reporting requirements on many business entities, including condo associations and HOAs.But many groups are now challenging the law’s key requirement to disclose ownership of corporate entities.After a series of courts upheld the law, a group of business entities led by the National Small Business Association are asking the US Supreme Court to weigh in to overturn the law.They argue it’s unconstitutional.

And they’re joined by several HOA groups, which are concerned that costs will increase.The suit comes at a time when millions of Americans are part of HOA communities, where dues are rising.A string of fraud and theft cases involving HOAs have followed.

And several states have come forward with potential reforms.Developed in 2017 and enacted in 2021, the Corporate Transparency Act (CTA) is intended to cut down on financial fraud.The law required 32 million American business and financial entities to file information about their beneficial owners and officers, including names and addresses, under threat of punishment from the Treasury Department’s Financial Crimes Enforcement Network.A series of lawsuits followed nationwide and the CTA’s implementation was paused and resumed several times as different courts weighed in.Eventually, the Trump administration relented and announced last year it would aim enforcement efforts at curtailing international fraud.

But it kept the law on the books, arguing the government loses billions a year to financial crimes.Lawsuits continued from businesses and entities that claimed the federal government was intruding into affairs that the Constitution delegates only to the states, violating the Commerc...