On July 13, the U.S. Court of Appeals for the 9th Circuit affirmed a district court’s preliminary injunction blocking FinCEN from enforcing a Geographic Targeting Order (GTO) that, as previously covered by InfoBytes, required money services businesses (MSBs) along the southwest border to file currency transaction reports for cash transactions between $200 and $10,000, a reduction from the longstanding $10,000 reporting threshold. FinCEN issued the order on March 11, 2025, covering 30 ZIP codes across Texas and California. After the order expired in September 2025, FinCEN issued a second order lowering the threshold to $1,000 and expanding coverage to Arizona (previously covered by InfoBytes here), followed by a third order in March 2026 extending to New Mexico; the government maintains only the original order is at issue on appeal.

The panel held that the GTO was likely a rule rather than an order under the APA because it applied to unnamed and unspecified MSBs based on general policy considerations rather than resolving a dispute involving particular parties, meaning FinCEN was required to undergo notice-and-comment rulemaking before issuing it. The court further found the GTO was likely arbitrary and capricious because FinCEN failed to consider the cost of compliance to regulated businesses, and because an internal agency memorandum offered as evidence that costs had been considered was undated, heavily redacted, and appeared to be an unapproved draft. The panel also upheld the district court’s finding of likely irreparable harm, citing an estimated compliance burden of 14.8 to 17.26 hours per day, the loss of 50 to 60 percent of customers within the single week the order was in effect, and the government’s own concession that there was “evidence of harm in the record.”

In weighing the balance of equities and the public interest, the court concluded that the concrete threat to the business outweighed the government’s argument that the injunction impeded a broader data-collection effort intended to support national security and law enforcement functions, and it upheld the district court’s decision to limit the injunction’s scope to the Southern District of California. One judge dissented, arguing the plaintiffs failed to provide sufficient evidence to establish irreparable harm warranting the “extraordinary relief” of a preliminary injunction, and would have remanded the case for further factual findings.