Senate sends veto-proof AML reforms to White House

WASHINGTON — The Senate voted overwhelmingly Friday in favor of reforms to the nation’s anti-money-laundering framework, sending the industry-backed measure to President Trump’s desk with a veto-proof majority.

The Senate voted 84-13 to approve the National Defense Authorization Act, which includes an amendment that would require businesses to report their true owners to the Financial Crimes Enforcement Network at the point of incorporation. The legislation would spare banks the burden of reporting their customers’ owners to Fincen.

“The global law enforcement and national security community will reap enormous benefits from anti-money-laundering policy that stops bad actors from using shell companies to shepherd crime across international borders,” Greg Baer, president and CEO of the Bank Policy Institute, said in a press release.

The Senate vote comes after the House passed the defense spending bill 335-78. Trump has threatened to veto the legislation over its lack of restrictions for social media companies, but it garnered more than the two-thirds majority needed in each chamber for an override.

“These anti-money-laundering and corporate transparency reforms were long overdue," said Sen. Sherrod Brown of, the top Democrat on the Senate banking Committee. “I hope my Republican colleagues who voted for this bill stand up to President Trump’s threatened veto and vote to override it if necessary so that our federal, state and local officials will finally have the modern tools they need to protect our communities and bring these criminals to justice.”

The inclusion of the beneficial ownership amendment in the bill was in large part a push by Rep. Carolyn Maloney, D-N.Y., to crack down on anonymous shell companies after the 9/11 attacks in 2001.

While the banking industry supported the reforms the AML reporting regime, the National Federation of Independent Business lobbied heavily against the legislation, saying it would put unnecessary burdens on small businesses.

“This legislation would burden small businesses with 12.2 million new initial paperwork hours at a cost of $531 million, something small business employers simply cannot afford as they deal with the ongoing COVID-19 pandemic,” Kevin Kuhlman, vice president of federal government relations at the federation, said in a press release.