Yes, it is. Im pretty sure its on a state by state basis, but I know for a fact that in Az, its against the law. The reason for this is because if the check engine light isnt functioning/removed, you're basically screwing the buyer when it comes time for emissions. Thats about the only thing you could possibly get sued for in a used car transaction, is if you neglect to tell the buyer something that will effect the licensing and or emissions of the vehicle. You absolutely have to disclose that kind of stuff, and by disabling the check engine light, you're failing to do so.
hope this helps, its no bs, atleast in my state.
New Jeep. 142db as of now, Details to follow.