ILLICIT CASH Act Opens Viable Pathway to Senate Passage

Statement by Gary Kalman, Executive Director of the FACT Coalition

WASHINGTON, D.C. — A bipartisan group of eight U.S. senators on a key Senate committee introduced legislation Thursday to update federal anti-money laundering laws and end the incorporation of anonymous companies in the U.S.  Titled the Improving Laundering Laws and Increasing Comprehensive Information Tracking of Criminal Activity in Shell Holdings (ILLICIT CASH) Act (S.2563), the measure is sponsored by Senators Mark Warner (D-VA), Tom Cotton (R-AR), Doug Jones (D-AL), Mike Rounds (R-SD), Bob Menendez (D-NJ), John Kennedy (R-LA), Catherine Cortez Masto (D-NV), and Jerry Moran (R-KS), who all sit on the relevant Senate Committee on Banking, Housing, and Urban Affairs.

The ILLICIT CASH Act opens a viable pathway to Senate passage after the House of Representatives Committee on Financial Services voted in favor of a measure with similar provisions — the Corporate Transparency Act of 2019 (H.R.2513) — by a bipartisan vote of 43-16 in June of this year.  Both bills would require companies to disclose their true (i.e. beneficial) owners when they incorporate and keep their ownership information up-to-date.

Gary Kalman, the executive director of the Financial Accountability and Corporate Transparency (FACT) Coalition, issued the following statement:

“For years, rogue actors have been using anonymous companies formed in the U.S. to evade sanctions and finance terrorist networks.  Human trafficking operations and drug cartels launder money through secret U.S. company structures, and corrupt foreign officials exploit the loopholes in our laws to hide the funds they pilfer from national treasuries.  The ease with which bad actors can hide illicit cash in the U.S. undermines our national security, props up rogue leaders and renegade regimes, and destroys lives — both here and abroad.

“The ILLICIT CASH Act is a direct and effective response to the dangers and devastation that result from the lack of safeguards to protect our financial system from abuse.

“For more than a year, the bill sponsors have been working across party lines to find ways to address these threats.  Ending the ability of the criminal and corrupt to hide behind anonymous shell companies is essential.  The current lack of information on company ownership is now widely recognized as the critical missing piece of information in tracking bad actors.  The ILLICIT CASH Act requires a basic level of transparency that, for the first time, will allow police, prosecutors, national security officials, and others to follow the money.

“We applaud the leadership of Senators Warner, Cotton, Jones, Rounds, Menendez, Kennedy, Cortez Masto, and Moran and appreciate the long and difficult negotiations that led to this introduction.  There are some provisions that we hope can be refined as the bill moves forward, but, after more than a decade of Senate debate and inaction on the issue of anonymous companies, the sponsors have produced a bill that closes the single most significant gap in our anti-money laundering laws. And a bill with an extremely broad and diverse range of support.

“We look forward to working with the sponsors as well as Committee and Senate leadership to move this effort forward.”

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Journalist Contact:

Clark Gascoigne
Deputy Director, The FACT Coalition
+1 202 810-1334
cgascoigne@thefactcoalition.org

Notes to Editors:

• Click here for an online version of this press release.
• Click here to read a 1-page summary of the ILLICIT CASH Act.
• Click here to read a section-by-section summary of the ILLICIT CASH Act.
• Click here to read the full legislative text of the ILLICIT CASH Act.
• Click here for a list of individuals and organizations endorsing beneficial ownership transparency.