The decision was made after a state law went into effect, which allowed undocumented immigrants to apply for a driver's license while protecting their information from immigration enforcement agencies.
In April, New York amended the provision to allow some access to driving records.
The Trump administration had claimed that New York's policy limiting access to criminal history information found in motor vehicle records was unique among the states, and made it impossible to determine whether someone qualified for trusted status.
In truth, several states plus Washington D.C. also don't provide access to driving history information, the lawyers wrote. And yet all of those states, including California, were allowed to remain in the program.
"Defendants deeply regret the foregoing inaccurate or misleading statements and apologize to the Court and plaintiffs for the need to make these corrections at this late stage in the litigation," the government attorneys wrote.
WATCH: Gov. Andrew Cuomo Gives Briefing
Friday, Gov. Andrew Cuomo called for an investigation into the decision to pull New York from the Trusted Traveler programs, saying it was clearly political retribution.
"And they represented to the court that they had a bona fide reason to stop New York because New York was going to do unique harm," Cuomo said. "So I think the Department of Justice should investigate that. I think the Congress should investigate it. Because they lied, and they did a lot of damage. There's also a possibility of New York seeking civil damages for this wrongful act by the federal officials."
Government attorneys also asked the judge to permit them to withdraw motions and briefs that sought dismissal of the lawsuit, filed by New York Attorney General Letitia James, and informed the court that New Yorkers were being let back into Trusted Traveler programs "effective immediately."
James said in a statement that the removal of the ban was "a victory for travelers, workers, commerce, and our state's economy."
The announcement comes at a time when international travel has been severely curtailed because of the pandemic, and a number of countries have barred U.S. travelers because of the high number of cases in the country.
Cuomo, who met with President Trump at the White House to try to allow New Yorkers to rejoin the program and restart the importation and exportation of vehicles, said the fix protected New Yorkers' privacy while addressing federal concerns.
"I am glad that this issue has finally been resolved for all New Yorkers," he said.
In its announcement that the state was being readmitted to the program, DHS officials said New York's amended law, while restoring some federal access, is still "antithetical" to the agency's mission and data access policies.
"Nonetheless, local New York law continues to maintain provisions that undermine the security of the American people and purport to criminalize information sharing between law enforcement entities," Acting Secretary Chad Wolf said.
(© Copyright 2020 CBS Broadcasting Inc. All Rights Reserved. The Associated Press contributed to this report.)
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