Small Business Majority has sent a letter to Senate leadership calling for the passage of the Anti-Money Laundering Act of 2020 (S.Amdt.2198 to S.4049) in order to modernize the U.S. AML regulatory environment. The full letter can be read below or downloaded here.
June 29, 2020
The Honorable Mitch McConnell
Washington, D.C. 20510
The Honorable Chuck Schumer
Washington, D.C. 20510
RE: Anti-Money Laundering Act of 2020, Amendment to the National Defense Authorization Act of 2021
Dear Majority Leader McConnell and Minority Leader Schumer,
As a leading representative of the 30 million small businesses in America, Small Business Majority writes to offer our support for the “Anti-Money Laundering Act of 2020” as an amendment to the National Defense Authorization Act. We greatly appreciate the bipartisan commitment to protect small businesses from the myriad ways in which anonymous companies undermine legitimate small business owners.
Small Business Majority was founded and is run by small business owners to ensure America’s entrepreneurs are a key part of thriving and inclusive economy. We actively engage our network of 65,000 small business owners in support of public policy solutions and deliver information and resources to entrepreneurs that promote small business growth and drive a strong, sustainable job- creating economy.
As we have noted in the past, shell companies with hidden owners put small businesses at a disadvantage by unfairly competing for contracts, undermining our supply chains, creating difficulties in finding responsible subcontractors and providing cover for fraudsters. Patent trolls often hide behind anonymous front companies that disproportionately target small and medium sized businesses, and cost businesses upwards of $29 billion in 2011 alone, according to a study by Boston University Law School.
These continuing problems are why we support legislation that includes collection of basic information on beneficial ownership. Scientific opinion polling conducted on behalf of Small Business Majority found small business owners nationwide overwhelmingly believe Congress should pass legislation requiring businesses to list their true identity when forming. Eighty-four percent of small business owners say the use of shell companies to win contracts or obtain government set- asides reserved for small businesses is a problem. Nearly 6 in 10 (58%) believe this is a major problem.
It’s important to note that small businesses believe providing the name, address and identification of the true owner of a business is not a burden. Indeed, more than 3 in 4 of those surveyed (76%) think requiring a small business to list the true identities of their owners would benefit small businesses by protecting them from contract fraud and giving them fair access to government set-asides.
Small business owners are well aware of who controls and who benefits from their proceeds. The definition in the bill is clear, easy to follow, and workable for small businesses who have no need to hide their owners’ identity. Further, knowing that businesses have given this information provides assurance that a real person is behind any contract a small business owner signs or company with which they may compete. The beneficial ownership provisions also reduce uncertainty and potential liability when dealing with suppliers and subcontractors. While the benefits are significant, the costs of providing basic information are minimal and immediately known to our members.
Thank you for consideration of our views and we look forward to working with you on this important legislation. For any questions or additional information, please contact Government Affairs Manager Awesta Sarkash at [email protected]
John Arensmeyer, Founder & CEO