This article is cross-posted from the Global Witness blog.

For three and a half years, a former Pentagon supplier used two shell companies in Wyoming and pretended they were largely owned by ethnic minorities to win preferential treatment for government contracts so that he could profit from supplying substandard parts to the military. These schemes happen all too often. In another, conspirators used sham companies from North Carolina, Nevada and Tennessee to steal more than $2 million from subcontractors that they tricked into fulfilling contracts.

The US Administration is coming upon a key moment tomorrow at the international Anti-Corruption Summit hosted by the UK where it can keep the criminal and corrupt from ripping off our public budget while hiding behind the veil of an anonymous shell company.

A little known fact, even after the Panama Papers exposé, is that many US states are among the easiest in the world for anyone to create a company while hiding the fact that they own it. Research also shows that the US is a favored place for the corrupt to incorporate anonymous shell companies. They have been used to hide stolen assets, evade taxes and sanctions, as well as to traffic money, weapons and humans. They have also been used to defraud American businesses, taxpayers and the government, including through public procurement as I’ve discussed in a previous blog.

The result of such fraud harms all of us in the form of lower quality infrastructure and services, higher prices, wasted tax dollars and decreased trust in government. Just a few of these examples from our online interactive map where we track the abuse of anonymous company ownership around the world include:

• A contractor deceived the Small Business Association while hiding behind his Portuguese employee to win preferential treatment and fraudulently secure federal government contracts worth $31 million through various means, including bribing a U.S. government official.
• US Lieutenant Colonel passed on information to a business owner and contractor to create the perfect bid, and steal more than $20 million from taxpayers and Afghan commando troops while transferring their loot through anonymous shell companies in Virginia and Massachusetts.
• Criminals behind the largest US Medicare fraud managed to steal over $35 million from the government program by creating at least 118 fake health clinics in around 25 states in the names of anonymous companies incorporated in eight states.
• Fraudsters used companies anonymously incorporated in Florida, Georgia, North Carolina, South Carolina and Louisiana to steal approximately $70 million that was meant to help HIV and cancer suffers through the government’s Medicare program.

Federal procurement is an important area where the Administration has the authority to act without Congress and to significantly impact the devastating consequences of waste, fraud and abuse.

The Administration should reinforce its recent commitments to strengthen financial transparency and combat money laundering and corruption at the UK Anti-Corruption Summit with a pledge to collect and verify information about the real people who own or control companies bidding for government funds (also called “beneficial owners”). This information, in addition to award and contract information, should be made publicly available for free and in an open data format.

Global Witness has joined civil society organizations—including the FACT Coalition—in a call for the Administration to embed beneficial ownership transparency in federal procurement through the current implementation of the Digital Accountability and Transparency Act of 2014 (DATA Act). This is the first legislation of its kind to mandate data transparency that seeks to link up US federal spending information as standardized data available to everyone on line.

As highlighted in a recent letter to the Administration by civil society organizations, including Global Witness, a commitment to beneficial ownership transparency in federal contracting could be advanced in its updated Open Government Partnership National Action Plan expected to be released this summer. Global Witness has already joined civil society organizations in urging the Administration to make similar commitments in its first National Action Plan on Responsible Business Conduct due out this summer.

This is a matter of public interest, which involves taxpayer funds that are being exposed to high levels of risk, abuse and corruption. We believe that the public has the right to know how its money is being spent and who is benefiting from those funds. As the single largest purchaser in the global economy, the US has a lot to lose if it doesn’t act to close the gap in the law and the hole in its pocket.