A federal judge has blocked a major new rule that would have changed how real estate transactions are tracked in the U.S.

I'm Kathy Fedke, and this is Real Estate News for investors.

This is Real Estate News with Kathy Fedke.

The rule came from the Financial Crimes Enforcement Network, part of the Treasury Department.

It would have required disclosure of buyers in all-cash residential real estate deals.

That means if someone bought a home without a mortgage, their identity would have to be reported

to the federal government. The goal was to fight money laundering. Officials said criminals sometimes use

anonymous LLCs or trusts to hide illegal money in real estate. In fact, the Treasury estimated

that about $2.3 billion was laundered through the U.S. housing between 2015 and 2020.

This rule would have dramatically expanded oversight. Earlier versions of

this policy only applied to high-risk markets like New York City in Miami, and they only

covered purchases above $300,000. But the new rule would have gone nationwide. It also removed

the price threshold entirely. That means nearly every

all-cash-home purchase could have been reported. According to FinCEN, more than 800,000

transactions each year would have been affected. But now that rule has been stopped. U.S. District

Judge Jeremy Kernodal ruled that the Treasury overstepped its

authority. In his decision, he said the government failed to prove that all cash real estate deals

are inherently suspicious. The lawsuit was brought by the Pacific Legal Foundation on behalf of a Texas

title company. They argued the rule was burdensome, and they said it essentially turned real estate professionals

into agents of government surveillance.

There were also concerns about privacy.

Some attorneys noted that clients were uncomfortable having sensitive personal data like social

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