Historic Anti-Corruption Reform Becomes Law after More than a Decade-Long Campaign
WASHINGTON, D.C. — An historic anti-corruption measure ending anonymous companies in the United States became law on Friday, capping a more than decade-long campaign by transparency advocates, after both Chambers of Congress voted to override the president’s veto of the annual defense bill. The Financial Accountability and Corporate Transparency (FACT) Coalition, which led the organizing effort, praised the enactment of the Corporate Transparency Act, which was included in the National Defense Authorization Act.
Ian Gary, executive director of the FACT Coalition, issued the following statement:
“After more than a decade-long campaign to end the formation of anonymous shell companies that are abused by the criminal and the corrupt, the United States has enacted historic reforms to protect Americans and our financial system from abuse. We applaud Senate and House lawmakers for passing this critical, bipartisan anti-corruption reform by overwhelming margins. We look forward to working with the incoming Biden Administration to ensure the strong and timely implementation of the new law.
“For years, experts routinely ranked anonymous shell companies — where the true, ‘beneficial’ owners are unknown — as the biggest weakness in our anti-money laundering safeguards. Virtually every national security expert, law enforcement official, and human rights advocate that looked at the issue called for an end to anonymous companies. It’s the single most important step we could take to better protect our financial system from abuse.
“For more than a decade, the FACT Coalition and our members have worked tirelessly to assemble a powerful alliance of ideologically-diverse constituencies to back an end to anonymous companies. Supporters of transparency eventually included hundreds of national security experts, police and prosecutors, banks and credit unions, CEOs, the real estate sector, large businesses, small business owners, faith groups, anti-human trafficking groups, human rights organizations, global development NGOs, anti-corruption advocates, labor unions, and conservative and liberal think tanks. The campaign was so successful that the State of Delaware and the U.S. Chamber of Commerce — both of which had previously opposed reform — ultimately endorsed transparency.
“The FACT Coalition truly appreciates the leadership of our allies on Capitol Hill, without whom this never would have been possible. Special thanks are due to Senators Brown, Crapo, Warner, Cotton, Jones, Rounds, Menendez, Kennedy, Cortez Masto, Moran, Whitehouse, Grassley, Wyden, and Rubio as well as Representatives Maloney, King, Luetkemeyer, Waters, McHenry, Cleaver, Malinowski, Wagner, and Waltz for their leadership on this issue. We also thank Leader McConnell, Leader Schumer, Speaker Pelosi, Leader McCarthy, Leader Hoyer, Senate Armed Services Chairman Inhofe, Senate Armed Services Ranking Member Reed, House Armed Services Chairman Smith, and House Armed Services Ranking Member Thornberry for prioritizing the Corporate Transparency Act’s inclusion in the National Defense Authorization Act. A special note of appreciation is also due to former Senator Levin, who introduced the first piece of legislation on this topic back in 2008.”
Notes to Editors:
- Click here for a FACT Sheet on the Corporate Transparency Act.
- Click here to read the conference committee text of the National Defense Authorization Act for Fiscal Year 2021.
- Click here to read the explanatory report for the National Defense Authorization Act for Fiscal Year 2021.
- Click here to watch a video of a press conference the FACT Coalition hosted with Sen. Sherrod Brown, the National District Attorneys Association, Transparency International, and Global Financial Integrity on Thursday, December 10th.
- Click here to watch a video of a press conference with Rep. Maloney and the FACT Coalition on Monday, December 7th. Rep. Maloney issued a press release after the press conference here.
- Click here for information on the support for ending anonymous companies, crossing industries and the ideological spectrum.
- The United States is currently the easiest place in the world to incorporate an anonymous company to launder money and evade law enforcement, according to academics at UT-Austin and Brigham Young University. In all 50 states, it requires less information to form a company than to obtain a library card. An increasing number of countries — including all 27 members of the European Union, the United Kingdom, the UK’s 14 overseas territories, and the UK’s 3 crown dependencies already require the disclosure of the true owners of companies.
Senior Policy Advisor, The FACT Coalition
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