Major INGOs Send Letter in Support of the Anti-Money Laundering Act of 2020 (S.Amdt.2198 to S.4049)

ActionAid USA, Bread for the World, Jubilee USA, the ONE Campaign, and Oxfam America sent a joint letter supporting the Anti-Money Laundering Act of 2020 (S.Amdt.2198 to S.4049). The bill will update U.S. AML regulations. The full letter can be read below or downloaded here.

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June 29, 2020

The Honorable Mitch McConnell

Majority Leader, U.S. Senate

The Capitol Washington, D.C. 20510

The Honorable Chuck Schumer

Minority Leader, U.S. Senate

The Capitol Washington, D.C. 20510

RE: Anti-Money Laundering Act of 2020 (S.Amdt.2198 to S.4049)

Dear Leader McConnell and Leader Schumer:

We write to encourage the Senate to advance the bipartisan Anti-Money Laundering Act of 2020 as a Crapo-Brown amendment to the National Defense Authorization Act for Fiscal Year 2021 (S.Amdt.2198 to S.4049). Sponsored by Senators Mike Crapo (R-ID), Sherrod Brown (D-OH), Tom Cotton (R-AR), Mark Warner (D-VA), Mike Rounds (R-SD), Doug Jones (D-AL), Jerry Moran (R-KS), Bob Menendez (D-NJ), and John Kennedy (R-LA), S.Amdt.2198 would strengthen our nation’s anti-money laundering laws and curtail the misuse of anonymous shell companies for illicit purposes.

We are the leaders of nongovernmental organizations delivering or advocating for both humanitarian and development assistance in countries affected by war, natural disasters, and chronic poverty. We and those we serve rely on the support of millions of generous Americans.

Based on decades of experience in international development, we have concluded that incorporation transparency is essential to alleviate poverty in the world. Corruption, tax evasion, arms trafficking, and human trafficking are scourges that afflict developing countries. These crimes have in common the fact that the trail of investigations into them often ends with anonymous shell companies.

Corruption is one of the principal barriers to economic development and poverty alleviation.[1] Not only does it waste public resources that could otherwise fund schools, clinics and other social services, but it also discourages private investment, and fosters distrust between citizens and their government, which makes countries ungovernable and prone to civil strife. The World Bank has documented 150 cases of grand corruption. 102 of the anonymous shell companies that enabled these crimes were registered in the United States – more than in any other country.[2]

Almost a third of rich Africans’ wealth – about $500 billion – is estimated to be held offshore, much of it undeclared to tax authorities, which may cost African governments $14 billion a year.[3] That is equivalent to the sums needed to pay for healthcare to save the lives of 4 million children and to employ teachers and allow every African child to go to school.

At least $2.2 billion worth of arms and ammunition was illegally imported by countries under arms embargoes between 2000 and 2010,[4] fueling civil wars that destroy lives and livelihoods and set countries decades backward on their development paths. Viktor Bout, known as the Merchant of Death, used a global network of shell companies, including twelve incorporated in U.S. states, to become the world’s largest arms trafficker before being captured.[5]

We witness horrific stories of refugees fleeing war zones only to fall prey to human traffickers.[6] Anonymous companies from Kansas, Missouri and Ohio were instrumental to trick victims from overseas in a $6 million human trafficking scheme.[7]

At their Summit in Lough Erne (United Kingdom) in 2013, G7 members including the United States committed to make progress to ensure that both tax and law enforcement authorities in all countries where companies operate are able to find out who really owns them. Other countries have delivered on their promises, and earlier this month the British government has even committed to extend incorporation transparency to its overseas dependencies including notorious tax havens like the British Virgin Islands, host of the most companies cited in the Panama Papers. The United States is a prime location for anonymous companies, providing them with a veneer of respectability as well as access to a deep financial system and strong rule of law. It is high time that our country delivers on this international commitment.

We thank you for your attention and your commitment to combatting illicit finance. If you would like more information, please contact Linda Delgado at linda.delgado@oxfam.org.

Sincerely,

David Beckmann, President

Bread for the World

Niranjali Amerasignghe, Executive Director

ActionAid USA

Tom Hart, North American Executive Director

The ONE Campaign

Eric LeCompte, Executive Director

Jubilee USA Network

Abby Maxman, CEO

Oxfam America

FOOTNOTES