The harm caused by illicit commerce, facilitated oftentimes by the abuse of anonymous companies, is far reaching.
In 2017, a Colorado court convicted four individuals, including a former police officer, of racketeering, money laundering, and conspiracy for illegally selling counterfeit Denver Broncos merchandise as well as additional sports products from other professional and college teams around the country. A key element of the international counterfeiting scheme was the use of more than 20 anonymous companies.
This is just one of a number of schemes that were highlighted in a FACT Coalition report, titled “Anonymous Companies Help Finance Illicit Commerce and Harm American Businesses and Citizens,” which was published earlier this year. Authored by David M. Luna, a former U.S. national security official and current chair of the Anti-Illicit Trade Committee of the United States Council for International Business, the report reveals the harms imposed upon legitimate businesses, unwitting consumers, and even the United States military by anonymous companies engaging in the trade in counterfeit and pirated goods. Currently, these criminal entities operate with impunity in the United States and are able to circumvent the law with little risk of accountability. The report concludes that enacting legislation requiring the disclosure of beneficial ownership information is an essential measure to combat the increasingly prolific abuses perpetrated by these shadowy networks.
Opaque Ownership Structures Obstruct Enforcement of a Growing Global Illegal Economy Valued at $500 Billion to $3 Trillion
WASHINGTON, D.C. – The formation and use of anonymous companies undermine the economic and financial interests of U.S. companies and markets according to a new report published Monday by the Financial Accountability and Corporate Transparency (FACT) Coalition. The author, former Chair of the OECD Task Force on Countering Illicit Trade David M. Luna, found that criminals and counterfeiters are expanding their market share with fake products in storefront and on-line markets, contributing to a growing global illegal economy valued at between $500 billion and $3 trillion. Criminally-derived profits (or dirty money) related to corruption and money laundering constitute several trillion dollars more that further finances insecurity and instability around the world.