March 16 2018
The lifeblood of criminal enterprises all over the world is revenue. Money fuels terrorists, transnational criminal organizations, and crooked kleptocrats. These criminals need to launder their ill-gotten gains. Although this dirty money often comes from the most corrupt, unstable countries in the world, it often ends up—ironically—in the United States.
Why? Partly because we have the most stable financial system in the world, and these malefactors seek rule-of-law protection for their ill-gotten gains. But they also come because our system is so opaque. Currently, none of the fifty states requires the disclosure of the “beneficial owner” of companies, the real human beings who own them. Instead, corporate records can identify the “owner” as another faceless corporation or a professional agent paid to sign the needed forms. Behind this easy-to-establish veil of secrecy, criminals can—and do—use these shell corporations to open bank accounts, transfer funds, and hide the ownership of expensive assets. The shell companies serve no economic purpose and don’t conduct any real business.