Large Banks Support Bid to Eliminate Anonymous Shell Companies
WASHINGTON — The biggest banks are supporting a bill that would ensure that all U.S. companies submit beneficial ownership information to authorities, arguing it would help combat money laundering and terrorist financing.
In a letter by The Clearing House Association, which represents the largest U.S. banks, the group said it opposes the existence of anonymous shell companies that can be used to launder assets.
The legislation "would assist public sector efforts to identify money laundering and terrorist financing through the disclosure of the beneficial owners of corporations," said Greg Baer, the president of the group and a former Treasury Department official in the Clinton administration. "We can see no justification for allowing corporations to shield their ownership."
After the departure of Financial Crimes Enforcement Network's director last month, the future of the Treasury Department unit remains the subject of fierce speculation within the financial services industry.June 28
A long-awaited final rule published this week that requires banks to keep better track of the owners of companies with accounts at their institutions is too little, too late in combating money laundering and terrorism financing, according to financial crime specialists.May 13
Along with publishing the long-awaited beneficial ownership rule, the Treasury and Justice Departments urged Congress to pass legislation to put the U.S. on par with foreign partners in the fight to curb the flow of illicit funds.May 5
But The Clearing House is also seeking changes to the legislation. It wants lawmakers to allow financial institutions to access beneficial ownership data reported to the states under the bill.
"Under the current regime, many if not most of the resources devoted to identifying money laundering and terrorist financing are provided by financial institutions," Baer said. "Denying them access to this important information would significantly undermine the goals of the bill."
The letter was addressed to the four lawmakers who are sponsoring the Incorporation Transparency and Law Enforcement Assistance Act: Sen. Charles Grassley, R-Iowa, Sen. Sheldon Whitehouse, D-R.I., Rep. Peter King, R-N.Y., and Rep. Carolyn Maloney, D-N.Y.