Provision Would Force all Shell Companies to Reveal Ownership

By Kerry Smith

A move to fight money laundering promoted by Sen. Rubio would require shell companies in real estate transactions nationwide to identify their actual owners.

WASHINGTON, D.C. – U.S. Senator Marco Rubio (R-FL) says he secured a provision in the National Defense Authorization Act (NDAA) for Fiscal Year 2021 (H.R. 6395) conference report that will help stop criminals, including sophisticated criminal organizations, from using anonymous shell corporations to engage in illicit activities like money laundering, sex trafficking, fraud, and terrorist financing. The initiative has already passed the Senate.

“In my home State of Florida, including in Miami, our law enforcement professionals know all too well that criminals readily use shell companies to remain anonymous and hide nefarious activity,” Rubio says. “I was proud to help secure this important provision in the NDAA that targets criminals hiding behind shell companies to engage in illicit activities like human trafficking, healthcare fraud, transnational corruption and terrorist financing. It is imperative that law enforcement has the basic information, tools, and authorities at its disposal to identify and disrupt criminal acts that put our communities and our national security at risk.”

The anti-money laundering provisions in the FY21 NDAA conference report builds on the Corporate Transparency Act (S. 1978), bipartisan legislation reintroduced last year. The Senate’s action sends the final conference report to the president.

Rubio first introduced the bipartisan Corporate Transparency Act with Senator Ron Wyden (D-OR) in August 2017. In August 2018, Rubio, Wyden, and Senator Sheldon Whitehouse (D-RI) succeeded in passing bipartisan legislation that laid the groundwork for expanding a U.S. Department of the Treasury initiative to curb foreign nationals laundering money through high-end real estate. The oversight system impacted selected U.S. cities, including Miami.

Last December, Rubio chaired a Senate Foreign Relations Subcommittee that focused on the ways anonymous shell corporations engage in illicit activity, including money laundering. 

Specifically, the Corporate Transparency Act, according to Rubio: 

• Generally requires basic information – name, address, date of birth, and a driver’s license number or other identification of the beneficial owner – be reported to the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) upon the creation of a company, with some exceptions. It doesn’t require financial information, business details or proprietary information

• Ensures government authorities that can access the beneficial ownership information do so only for authorized purposes

• Minimizes reporting burdens for companies

• Provides for civil and criminal penalties for willful violations of the requirements under this law.

© 2020 Florida Realtors® Reprinted with Permission

Click Here to Read the Original Article.