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Anonymity of Different Kind

By Jeremy Miller

Did you know the U.S. was a top destination of corrupt public officials for setting up shell companies in order to access the financial system?  Indeed it is, and once illicit funds are trafficked through an anonymous corporate vehicle, it’s extremely difficult for law enforcement to track them down. 

That’s why today CREW and dozens of other good governance groups and international civil society organizations sent a letter urging members of Congress to co-sponsor and pass the Incorporation Transparency and Law Enforcement Assistance Act (S. 1483/H.R. 3416).

The letter states:

Increased corporate transparency would curb corruption and tax evasion, promote an equitable market economy, reduce the opacity of corporate campaign contributions, help ensure a fair and level playing field for small- and medium-sized businesses, foster global development and enhance national security…

Investigations continue to reveal that American and foreign terrorists, narco-traffickers, arms dealers, corrupt foreign officials, tax evaders, individuals targeted for financial sanctions and other criminals easily and regularly set up U.S. shell companies, without providing any information about who owns or controls such companies...This enables criminals to disguise their identities behind the anonymity provided to U.S. corporations and launder dirty money through the U.S. financial system.

In short, these shell corporations undermine not only U.S. laws aimed at combating money laundering and tax evasion, but international efforts to stem global corruption as well. 

The legislation simply requires that companies disclose their ultimate owners at the time of incorporation, thereby making it much harder for corrupt politicians, tax evaders and others from hiding behind the anonymity afforded to U.S. corporations.  The U.S. shouldn’t be a playground for foreign and domestic corrupt financial practices.  This legislation will shine a light on the identities of who really owns these shell corporations and make it easier for law enforcement to bring them to justice.