The U.S. is the easiest place in the world for a criminal, terrorist, tax cheat, or kleptocrat to open an anonymous shell company to launder their money with impunity. Anonymous corporations are great ways to hide money and other assets — they can hold a bank account or buy a yacht. Criminals often layer anonymous corporations, with one owning another and so on, making it even harder for law enforcement to “trace the money” and figure out who is directing the company’s activity. It’s time to ending the use of anonymous shell companies as vehicles for illicit activity by requiring that the true owners of U.S. companies be disclosed at the time of formation and updated upon any change.
FACT urges Treasury to heed the calls of law enforcement, national security, and other experts by fully implementing the Corporate Transparency Act in accordance with congressional intent and the plain language of the law.
FACT hosts environmental crime journalists, public comments on Treasury’s gutting of the Corporate Transparency Act are due May 27, and House lawmakers pass massive tax and spending cuts package.
Congress must help restore the original scope and intent of the Corporate Transparency Act in light of clear evidence of the risks posed by anonymous shell companies to national security, law enforcement, U.S. consumers, and small businesses.
The Treasury issues an interim final rule that guts the CTA, Law Enforcement and financial transparency experts protest, and a hearing on fraud prevention brought attention to the issue of anonymous shell companies.
Read FACT’s official statement for the record submitted ahead of Tuesday’s HFSC subcommittee hearing on fraud prevention, including comments in opposition to H.R. 425. the Repealing Big Brother Overreach Act, which would fully repeal the Corporate Transparency Act.
“Treasury’s proposal contradicts decades of evidence that sanctions evaders, tax cheats, and fentanyl traffickers rely on anonymous U.S. companies to stash their illicit cash in the U.S. financial system.
