Questions Lawmakers Should Ask at the June 20th Hearing on Beneficial Ownership

2019-06-20T10:04:57-04:00
June 20, 2019
Fellow for Malign Finance, Alliance for Securing Democracy
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Today, the Senate Banking Committee will hear outside perspectives on the collection of beneficial ownership information.

This hearing is well-timed, as momentum is building in both the House and the Senate to outlaw anonymous shell companies. For example, after six months of negotiations, last week a bipartisan group of four Senators serving on this committee released a discussion draft of legislation that would address beneficial ownership and enact other anti-money laundering reforms. It would be a positive next step for the full committee to formally take up and consider that discussion draft or other specific proposals to ban anonymous shell companies.

Below are questions the committee might ask witnesses on Thursday.

  • Would outlawing anonymous shell companies help defend against Russia by assisting the efforts of the U.S. Treasury and U.S. law enforcement to find the dirty money that Vladimir Putin and his crony friends have stolen, hidden in U.S. property markets, and spent undermining democracies in the United States and Europe?
  • Explain how Chinese companies like Huawei use anonymous shell companies to hide the influence of the Chinese government and to evade sanctions on rogue regimes like North Korea and Iran.
  • When the United States catches up to almost every other developed country by outlawing anonymous shell companies, we will improve our moral standing to advocate for similar reforms internationally. What should the Congress and the State Department do to take advantage of that opportunity? Should we mobilize allies around malign finance reforms to counter the new asymmetric threat posed by authoritarian regimes, like the effort against terrorist financing after 9/11?
  • How do we know whether collecting beneficial ownership information can work? What evidence can we draw from the experience of collecting real estate ownership information through the Geographic Targeting Order program run by the U.S. Treasury Department over the past three years?
  • How is it possible that in all 50 states less information is required to register a company than to get a library card? Please comment on the extent of any privacy or cost considerations associated with providing a name and address to be handled confidentially by U.S. regulatory and law enforcement authorities.

The views expressed in GMF publications and commentary are the views of the author alone.