As Part of the National Defense Authorization Act, Senate Expected to Send Corporate Transparency Act to President’s Desk Later This Week
WASHINGTON, D.C. — By a veto-proof majority of 335 to 78, the U.S. House of Representatives advanced historic legislation to end the incorporation of anonymous companies in the United States on Tuesday, the eve of International Anti-Corruption Day, teeing up final passage by the Senate later this week. The Corporate Transparency Act is included in the annual “must-pass” defense bill, known as the National Defense Authorization Act, which is expected to become law before the end of the year.
The Financial Accountability and Corporate Transparency (FACT) Coalition, which has led the more than decade-long effort to end anonymous companies in the U.S. praised the advancement of the landmark anti-corruption reform.
Ian Gary, executive director of the FACT Coalition, issued the following statement:
“After more than a decade of debate and inaction in Washington to end the abuse of anonymous companies and bring our anti-money laundering protections into the modern era, Congress is on the verge of enacting historic reforms to protect Americans and our financial system from abuse.
“It has been decades since our nation’s anti-money laundering laws were updated. Over time, rogue nations, criminals, and kleptocrats have developed ever more sophisticated strategies, but national security and law enforcement officials are currently working with outdated and insufficient tools to counter these emerging threats. As financial crimes accelerate due to the COVID-19 pandemic, it is more important than ever that we address this critical vulnerability to our financial system that anonymous companies represent.
“Experts routinely rank anonymous shell companies — where the true, “beneficial” owners are unknown — as the biggest weakness in our anti-money laundering safeguards. Virtually every national security and law enforcement official that has looked at the issue has called for an end to anonymous companies. It’s the single most important change Congress could make to better protect our financial system from abuse.
“The corporate transparency provisions in the defense bill present a major opportunity to address this serious national security vulnerability. They have the support of a powerful alliance of ideologically-diverse constituencies, including the national security community, police and prosecutors, the U.S. Chamber of Commerce, 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. It’s one of the few areas where the outgoing Trump Administration agrees with the incoming Biden Administration.
“We applaud the House of Representatives for advancing this critical, bipartisan reform by an overwhelming margin. It’s notable that the vote took place on the eve of International Anti-Corruption Day. We particularly appreciate the leadership of Representatives Maloney, King, Luetkemeyer, Waters, McHenry, Cleaver, Malinowski, Wagner, and Waltz on this issue. We also thank Speaker Pelosi, Leader McCarthy, Leader Hoyer, Armed Services Chairman Smith, and Armed Services Ranking Member Thornberry for prioritizing the Corporate Transparency Act’s inclusion in the National Defense Authorization Act.
“We call on Senators to similarly support these critical transparency reforms when they come up for a vote in the coming days.”
Notes to Editors:
- Click here for an online version of this release.
- 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 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
+1 202 813-0290