When kleptocrats, foreign intelligence services, homegrown autocrats, and other malign actors weaponize corruption to undermine U.S. democracy, their financial secrecy relies upon the services of ten sectors of U.S. professionals, including lawyers, real estate agents, hedge fund managers, and others. The U.S. government should promulgate new financial regulations—similar to existing rules for banks—that would require non-bank enablers to watch out for dirty money. Regulators should prioritize six or seven sectors of professionals known to gravely endanger U.S. national security by facilitating corruption.
Unfortunately, the United States is among the less than 10 percent of countries that do not require non-bank enablers to establish anti-money laundering (AML) programs, which are mandatory for banks. That is, unlike enablers based in more than 90 percent of the world, U.S. non-bank enablers do not need to have compliance officers, trainings, audits, and controls reasonably designed to spot potential money laundering by identifying customers, scrutinizing transactions, keeping records, and reporting suspicious activity to the government.
Fortunately, that may change soon, as the regulation of enablers has become a top priority among U.S. lawmakers, law enforcement, civil society, and other stakeholders.1 President Joe Biden’s memorandum prioritizing the fight against corruption as a core national security interest—and ordering U.S. departments and agencies to develop a presidential anti-corruption strategy within 200 days—included a prominent warning about the threat of U.S.-based professional enablers who move and launder dirty money.2
One implementation challenge is the severe underfunding of the Financial Crimes Enforcement Network (FinCEN), the bureau within the U.S. Treasury Department responsible for AML regulation.3 Moreover, there is limited consensus among policymakers and experts about which sectors of enablers FinCEN should prioritize regulation of between now and the end of Biden’s four-year term. There is little comprehensive research on which sectors pose the greatest national security threats, which regulatory efforts require additional statutory authorities or at least broad political support, and what other timing considerations should inform Treasury’s plan to expand regulation to cover enablers.
This report aims to fill that gap by sorting out those differences and recommending an order of prioritization for Treasury based on five timing considerations that vary significantly across the top ten sectors of enablers: how severely the lack of regulation threatens national security, whether mandatory deadlines are coming up, whether regulations are already drafted, how much experience FinCEN and each sector have with each other, and how much legal and political pushback regulations would unleash.
Based on those factors, this report recommends that Treasury strategically sequence a major regulatory rollout over the next few years, starting with easy wins before gauging the political appetite for harder fights:
- Stage I: During Biden’s Summit for Democracy in December 2021, Treasury should announce that it is embarking upon a campaign to regulate enablers, starting with the three lowest hanging fruit: investment advisors, title insurers, and art dealers.
- Stage II: After that, the regulatory trajectory should depend on whether Congress delivers the strong political support that Treasury would need to take on the four most problematic sectors: lawyers, trust and company service providers, accountants, and covert public relations operatives.
- Stage III: Without congressional support, Treasury should dedicate fewer resources to Stage II and instead focus the last two years of the Biden administration on repealing regulatory exemptions for sectors like real estate agents and sellers of yachts and jets, and sealing up cracks in the rules for cryptocurrencies and other money services businesses.
Stage I: Summit for Democracy
The anti-corruption strategy that Biden ordered to be completed by December 20, 2021 should feature the most sweeping plan to regulate non-bank professional enablers in U.S. history.4 The timing aligns closely with the first Summit for Democracy, which Biden will host on December 9 and 10 and will be followed by a second summit roughly a year later.5 At the December 2021 summit, FinCEN’s first two deliverables should be strong final rules for beneficial ownership (instructing U.S. companies to disclose to Treasury who ultimately owns them) and for antiquities dealers (imposing AML obligations on that market), both of which are statutorily mandated by year’s end.6 Crucially though, FinCEN should demonstrate that it is going beyond the mandatory minimum by also announcing that it will start implementing a national strategy to regulate enablers, beginning with the imposition of AML obligations on investment fund advisors, title insurers, and art dealers. At an official side event associated with the December 2021 summit, Treasury should publicly announce that it will be formally promulgating these three rulemakings in 2022. Treasury should plan to similarly initiate the second half of its strategy (focused on either Stage II or Stage III) at the second Summit for Democracy scheduled for late 2022.
1. Private equity and hedge funds
Kremlin-connected oligarchs have repeatedly used private investment funds and their managers as conduits to secretly funnel money into Western political systems. Examples include sweetheart investment opportunities for the top pro-Brexit donor, billions in lucrative Russian infrastructure deals for a Tory party donor, and several cases linked to private equity fund founder Konstantin Malofeev.7 The Mueller report documented how Vladimir Putin ordered Moscow businessmen to make contact with Donald Trump after the 2016 election, leading the head of Russia’s sovereign wealth fund to dangle an exclusive investment opportunity to a hedge fund manager close to Jared Kushner (a channel through which the Russians successfully submitted a secret foreign policy proposal).8 Now Kushner plans to launch his own investment company to make money in the Middle East, evoking concerns that the Saudis and Emiratis could secretly buy influence in U.S. politics through this private investment company, just as they appear to have done in the case of alleged secret agent Tom Barrack.9 To help law enforcement follow the money in cases like these, a leaked FBI bulletin suggests that regulators should impose AML obligations on private investment funds.10
Recommendation: FinCEN should update and finalize the rule it proposed in 2015 to make investment advisors (the SEC term for the management companies and professionals who run U.S. investment funds) establish AML programs.11 When proposing a new rule, the 2015 draft should be expanded to also cover advisors managing less than $100 million (an existing SEC registration threshold that works fine for investor protection but is too low to have caught any of the known cases of election interference to date) and those solely advising venture capital funds, family offices, rural funds, single-state funds, and overseas advisors with fewer than 15 U.S. clients.12 FinCEN should also expand the rule to include customer due diligence requirements that were still under development in 2015 but are now fully operable.13
2. Real estate title insurers
High-end real estate in U.S. cities is the world’s leading destination for vast sums of dirty money.14 The greatest testament to the dangerous opacity of U.S. property ownership may be the fact that over the past six years, journalists expended an unprecedented degree of effort probing whether Trump was deliberately enriched by Kremlin proxies through investments in Trump’s properties yet no reporters or any other investigators arrived at definitive conclusions one way or the other.15 In 2016, following a bombshell report on how often luxury condos are secretly owned by corrupt foreign elites, FinCEN started requiring U.S. title insurers to identify individuals who ultimately own at least 25 percent of any legal entity using all cash to buy high-end properties in big cities.16 That official data continues to show that 35 percent of the beneficial owners or their representatives are indeed suspicious.17 The usefulness of these geographic targeting orders (GTOs)—a temporary tool that FinCEN has been renewing every six months—demonstrates why FinCEN should make these reporting obligations permanent. The title insurance industry has implemented GTOs proficiently and would be receptive to a more certain regulatory regime. Importantly though, the regulations should be expanded to cover other markets exploited by kleptocrats to stash their ill-gotten wealth, exemplified by the case of Ukrainian oligarch-warlord Ihor Kolomoisky secretly buying up commercial office buildings scattered across the American Midwest.18
Recommendation: FinCEN should introduce a new rule imposing on U.S. title insurance companies the obligations that they currently face under GTOs to collect beneficial ownership data and remit it to FinCEN. However, compared to the relatively narrow scope of the GTOs, the new rule should be permanent, nationwide, not limited to any value thresholds, include commercial properties (in addition to residential), cover the seller’s identity (not just the buyer’s), and adopt the broader definition of a beneficial owner as stipulated under the new law mandating a separate ownership registry.19
3. Art dealers
In 2014, when Russia was invading Ukraine and Treasury was responding by sanctioning Kremlin cronies, email records obtained by Senate investigators suggest that the world’s largest auction house—Christie’s—was busy plotting to help the Russians evade the new sanctions by selling them art on the ground in Moscow.20 Within days, the newly sanctioned Rotenberg brothers started stashing $18 million in works of art bought by their Moscow-based art advisor.21 The advisor was a U.S. citizen, who in turn bought the art from auction houses and private dealers through chains of intermediaries such as advisors, galleries, and consultants—enablers who do not face U.S. obligations to ask who is on the other end of a transaction.22 The same expectation of secrecy is widespread in the auction markets for antiques and collectibles, which enabled one of the world’s most notorious kleptocrats—Teodorin Obiang of Equatorial Guinea—to conspire with Julien’s auction house in Beverly Hills to cover up the paper trail behind his use of intermediaries and straw purchases to become the largest buyer of Michael Jackson memorabilia.23
Recommendation: In its study of the art market, statutorily mandated to be completed by December 27, 2021, Treasury should conclude that U.S. dealers, advisors, consultants, custodians, galleries, auction houses, and museums trading in works of art, collectibles, or antiques worth at least $10,000 should be subject to AML regulations.24 In either the study or an accompanying statement, Treasury should announce that it will be initiating a rulemaking process to regulate these markets.
Stage II: The Four Horsemen
If FinCEN were to set regulatory priorities for the rest of Biden’s term based solely on which sectors of enablers threaten U.S. national security the most, it would focus on what this report calls the “four horsemen” of non-bank dirty money. Together with the previously recommended summit deliverables, regulating the first three horsemen—lawyers, accountants, and trust and company service providers—would largely bring the United States into compliance with international standards set by the Financial Action Task Force (FATF). Also regulating the fourth horseman—public relations firms enabling unattributable black ops through troll farms and influencers—would set a new best practice for an age of disinformation.
However, successfully regulating these powerful interest groups would require overwhelming political support. That would ideally include congressional legislation, but, at a minimum, it would have to be led by strong and visible backing from the president, the Treasury secretary, and a very broad coalition of lawmakers and interest groups. Absent that, FinCEN should assign just one or two full-time staffers to coordinate long-term projects dedicated to each of the four horsemen, tasked with preparing for future regulations by tracking malign activity, working within Treasury to develop future rules, and advocating for support on Capitol Hill and with allied factions within key interest groups.
Three stories show how lawyers can be the most dangerous enablers secretly funneling the proceeds of foreign corruption into the United States. A Global Witness investigation showed 12 out of 13 New York law firms eagerly sitting down with a representative of an obviously corrupt official from Africa to explain how he could abuse the law firms’ own escrow accounts and trustee services to launder money into purchases of luxurious U.S. properties and vehicles.25 Malaysian kleptocrat Jho Low used a bank account in the name of Manhattan law firm Shearman & Sterling to wire $369 million that he stole abroad into the United States, where he spent it on outrageous parties, yachts, jets, jewels, properties, Hollywood productions, and other lavish expenditures.26 Before Teodorin bought most of Michael Jackson’s estate, he used U.S. lawyers to trick six U.S. banks into accepting his dirty money by concealing it through attorney-client, law office, and other third-party conduit accounts.27
Recommendation: If lawyers are kleptocrats’ most useful enablers, they are also the sector that is the most politically organized in opposition to regulation.28 As such, an initiative to regulate lawyers needs to be prepared with well-laid legal and political strategies, including advocacy tactics to divide and conquer opponents from within. Except for a powerful faction of deregulation fanatics and real estate lawyers within the American Bar Association (ABA), most legal scholars and foreign courts agree that FATF standards for lawyer regulations—including mandatory suspicious activity reporting without tipping off clients—are scoped narrowly enough to avoid infringing upon attorney-client privilege.29 But just to be extra defensible in the likely event that the ABA sues to resist regulation, Congress could enact legislation to impose AML duties on lawyers, law firms, and notaries, and such a law could be narrowly scoped to only apply if and when legal professionals become “involved in financial activity or related administrative activity on behalf of another person.” That is, lawyers should be allowed to handle their clients’ money or avoid having to look for dirty money, but not both.
5. Trust and company service providers
About half of the 2 million U.S. legal entities created each year are formed with help from professionals known as trust and company service providers (TCSPs), which range from mom-and-pop outfits to sophisticated law firms providing an extra service to their clients.30 In addition to filing company formation paperwork with states on behalf of owners, for additional fees some TCSPs will allow owners to remain hidden by writing the TCSP’s own name and address on any documentation.31 Because the United States is one of the only countries in the world that does not impose AML regulations on TCSPs, it is not entirely surprising that U.S. TCSPs are the most likely in the world to not ask for any identification (almost half the time).32 Strikingly, academic researchers found that when potential customers present red flags of foreign corruption, that actually makes U.S. TCSPs less likely to turn away the customer or insist upon documentation.33 In one case, researchers posing as a Muslim charity in Saudi Arabia seeking financial secrecy were told by a U.S. TCSP, “[Y]our stated purpose could well be a front for funding terrorism…[I]f you wanted a functioning and useful Florida corporation you’d need someone here to put their name on it, set up bank accounts, etc. I wouldn’t even consider doing that for less than 5k a month.”34 Five thousand dollars a month to—in the eyes of the TCSP—potentially help fund terrorism.
Recommendation: Congress could make U.S. TCSPs stop being the most lax TCSPs globally by enacting the international standard, which is to impose AML obligations on the three main TCSP subsectors: company formation agents, trustee or nominee service providers, and providers of registered offices or business addresses.35
While shady accountants have been integral to the world’s most sophisticated criminal organizations—Al Capone’s Chicago Outfit, the Russian mafia, the New York mob, the Colombian FARC, Ihor Kolomoisky’s grand heist, and the Trump Organization’s alleged tax evasion—no case details the role of modern accountants as clearly as kleptocrat Isabel dos Santos, daughter of Angola’s former longtime ruler.36 She used the services of PwC and other accountants to become Africa’s richest woman through insider deals, preferential loans, and public contracts ordered by her father.37 Having once briefly worked as an accountant herself, Santos knew how to retain the most talented and pliant accountants in the world to run her business empire’s finances and advise on corrupt restructurings (even helping to draft self-dealing presidential decrees).38 And, while the “big four” accounting firms were reaping big fees through consulting, they also audited the financial records despite the clear conflict of interest—leverage that Santos used to pressure the auditors to keep quiet about the true ownership of her companies.39
Recommendation: Congress could finish bringing the United States into FATF compliance by adding accountants and accounting firms to the statutory list of regulated financial institutions.40 FinCEN would then have to write regulations establishing minimum standards for accountants’ AML programs, prescribing different rules for lines of business with varying degrees of risk, while also emphasizing useful information that accountants are particularly well-placed to scrutinize, like beneficial ownership.41
7. Covert PR and marketing firms
Over the past two years, social media platforms and U.S. law enforcement have had difficulty attributing foreign disinformation operations to the ultimate funders, because their investigations are running into dead ends in the form of public relations (PR) and marketing firms whose clients’ identities are well-kept secrets.42 In the 2020 election, this rapidly proliferating tactic was also used by domestic campaigners to secretly bankroll a pro-Trump troll farm in Arizona.43 This national security threat is not limited to election interference, as there are signs that Russia has begun funneling money through PR firms to secretly pay social media influencers to propagate disinformation tarnishing the Pfizer vaccine (falsely suggesting it kills people).44 If this rapidly growing trend is not arrested, the U.S. information environment risks becoming as polluted with commercial disinformation as the Philippines, where all matters of public debate are hotly contested narrative battles between dueling PR and marketing firms secretly hired by both sides to flood the zone with whatever content and tactics are needed to win.45
Recommendation: AML rules are not needed or advisable for most PR and marketing firms, because their traditional services—like helping known clients write press releases, speeches, and newsletters—do not involve laundering the source of money and disinformation from secret clients. Instead, legislation should only impose AML obligations on persons engaged in the business of PR, marketing, communications, or other similar services if and when they “provide another person anonymity or deniability” (i.e., black ops).
Stage III: Exemptions to Repeal
If Congress fails to deliver the overwhelming show of political support (ideally by amending the BSA) needed to regulate the four horsemen, Treasury should announce at the late-2022 Summit for Democracy that it will focus most intensively on repealing regulatory exemptions enjoyed by real estate professionals and luxury vehicle sellers, while also tightening up rules around cryptocurrencies and other money services businesses (MSBs).
Those first two sectors—real estate and luxury vehicles—were to create AML programs two decades ago under the Patriot Act, but Treasury continually granted them “temporary exemptions” to that statutory obligation.46 MSBs are generally already regulated by Treasury, but cracks continually emerge due to new technologies like cryptocurrencies.
8. Real estate agents, escrow agents, and real estate lawyers
In the modern history of the U.S. Treasury Department, no regulatory decision has done more to let dirty money flow with impunity than the 2002 exemption for real estate professionals. Teodorin’s secret purchase of a Malibu mansion was a joint effort carried out by professionals in the three top subsectors of real estate enablers: realtors, escrow agents, and lawyers.47 Key details about Ihor Kolomoisky’s Miami-based operation to buy commercial properties have come from brokers and realtors who spoke to the author of a new book, leaks that demonstrate how much information real estate agents have that would be useful for law enforcement.48 Real estate agents are similarly the most common sources in stories about suspicious oligarchs, mobsters, and crooked foreign officials secretly owning luxury condos in Trump properties.49 The extent to which real estate lawyers can offer anonymity was shown by the attorney who handled most of the condo sales in Trump SoHo and was caught literally using a pen to cross out Moscow addresses on property deeds and instead scribble in the address of his own law office located in another Trump building.50
Recommendation: Without any further action from Congress, FinCEN could initiate a rulemaking process to require “persons involved in real estate closings and settlements” to establish full AML programs, repealing the 2002 exemption. At a minimum, this should include title insurers, real estate agents, escrow agents, and real estate lawyers. In either this initiative or future expansions, FinCEN should also consider imposing AML rules on property management companies, real estate investment companies, and real estate development companies. FinCEN must also improve compliance and enforcement of non-bank residential mortgage lenders and originators.51
9. Luxury vehicle dealers
In addition to Michael Jackson memorabilia and a Malibu beach house, Teodorin funneled the money he stole in Equatorial Guinea into luxury vehicles on land, air, and sea.52 He would at times buy a new supercar every week or two from auto dealerships in Beverly Hills.53 He worked through lawyers, escrow providers, title insurers, and sales representatives to buy Gulfstream jets and massive yachts.54 And Teodorin was ultimately caught by law enforcement partly because his assistant bragged too openly—about his bid for Michael Jackson’s crystal glove—to the staff of a speedboat company in Florida.55
Recommendation: Again, without any additional action from Congress, FinCEN could impose AML obligations on “businesses engaged in vehicle sales,” including title insurers, dealerships or other agents of buyers or sellers, escrow agents handling funds for vehicle sales, and lawyers engaged in vehicle sales, while also considering how and when to cover manufacturers of high-end vehicles.
10. Crypto and other money services businesses
Most of the U.S. payments system is already regulated, including for some major new technologies like cryptocurrencies, but malign actors continue to exploit emerging regulatory gaps. For example, ransomware payments are usually made to hackers’ software-based “unhosted wallets” that are not operated by any central entity that Treasury can regulate.56 Beyond crypto and cyber threats, terrorists and fentanyl traders move money below the $3,000 threshold at which information on wire transfers must “travel” alongside money throughout the payment chain.57 Kleptocracies secretly funnel millions of dollars to U.S. presidential campaigns through third-party payment service providers that fall outside the definitions of regulated sectors.58
Recommendation: FinCEN should continue sealing up regulatory cracks related to crypto and other money services businesses (MSBs) by: (1) reducing the travel rule threshold from $3,000 to $250 and clarifying that it also applies to cryptocurrencies;59 (2) making banks and MSBs report their customers’ transactions with cryptocurrency wallets that are unhosted (or hosted in North Korea, Iran, or Burma);60 (3) redoubling diplomatic efforts to harmonize cryptocurrency standards and implementation globally; and (4) conducting a comprehensive review of third-party service providers that cater to shady phone and internet businesses or high-risk jurisdictions.61
Biden has launched what could become the most sweeping policy initiative against corruption and kleptocracy in U.S. history.62 But for the mission to succeed, ambitious rhetoric must now be matched with comprehensive implementation.
The Biden administration should start by including bold plans to regulate enablers in its forthcoming presidential strategy to fight corruption. In time for the December 2021 Summit for Democracy, Treasury should announce that it will begin implementing Biden’s anti-corruption strategy by imposing AML obligations on investment advisors, title insurers, and art dealers. Separately, Congress should enact legislation naming all ten sectors discussed in this report as types of financial institutions. If those initial steps go well, Treasury should announce at the late-2022 Summit for Democracy that it will also move to regulate lawyers, TCSPs, accountants, and covert PR firms. Otherwise, Treasury should focus the second stage on repealing exemptions for real estate professionals, luxury vehicle sellers, and money services businesses.
This is how the United States stops being the world’s largest haven for dirty money and shows how democracies can deliver against crooked adversaries and powerful special interests.63 The time has come to regulate the enablers.
- Tom Malinowski and Sheldon Whitehouse, letter to Janet Yellen, May 3, 2021; Timothy Llyod, “FBI Concerned over Laundering Risks in Private Equity, Hedge Funds – Leaked Document,” Reuters, July 14, 2020; Christopher Starke, “Gary Kalman on the Corporate Transparency Act & the Corruption Index in the USA,” Kickback – The Global Anticorruption Podcast, podcast, February 15, 2021.
- President Joseph R. Biden, “Memorandum on Establishing the Fight Against Corruption as a Core United States National Security Interest” (official memorandum, Washington DC: White House, June 3, 2021) (“NSSM-1”).
- Gary Kalman and Josh Rudolph, “Congress Can Do Better to Fight Weaponized Corruption,” Foreign Policy, April 1, 2021.
- White House, “President Biden to Convene Leaders’ Summit for Democracy,” press release, August 11, 2021.
- U.S. House of Representatives, William M. Thornberry National Defense Authorization Act for Fiscal Year 2021, HR 6395, 116th Cong., introduced in the House January 2, 2021, sections 6403(a) and 6110(a); Josh Rudolph, “Regulating Beneficial Ownership for National Security,” The Alliance for Securing Democracy (blog), April 29, 2021.
- See Josh Rudolph and Thomas Morley, Covert Foreign Money: Financial Loopholes Exploited by Authoritarians to Fund Political Interference in Democracies (Washington: The Alliance for Securing Democracy, August 2020), pages 80-81, 84, and 95-96; David Kirkpatrick and Matthew Rosenberg, “Russians Offered Business Deals to Brexit’s Biggest Backer,” The New York Times, June 29, 2018; Holly Watt, “May Must Explain Tory Donor’s Links to Russia, Says Labour MP,” The Guardian, August 27, 2016; Maksym Bugriy, “Hot Issue – Konstantin Malofeev: Fringe Christian Orthodox Financier of the Donbas Separatists,” The Jamestown Foundation (blog), August 8, 2014.
- See Special Counsel Robert S. Mueller, Report on the Investigation into Russian Interference in the 2016 Presidential Election (Washington: U.S. Department of Justice, March 2019) (“Mueller Report”), vol. 1, page 158.
- See Steve Holland, “Jared Kushner to Leave Politics, Launch Investment Firm – Source,” Reuters, July 28, 2021; Ben Rhodes (@brhodes), “Watch the Saudi and Emirati money,” Twitter, July 28, 2021; Sharon LaFraniere and William Rashbaum, “Thomas Barrack, Trump Fund-Raiser, Is Indicted on Lobbying Charge,” The New York Times, July 20, 2021; U.S. Department of Justice, “Former Advisor to Presidential Candidate Among Three Defendants Charged with Acting as Agents of a Foreign Government,” press release, July 20, 2021.
- Federal Bureau of Investigation, (U) Threat Actors Likely Use Private Investment Funds To Launder Money, Circumventing Regulatory Tripwires, website posting by the Scientology Money Project of an FBI intelligence bulletin revealed in the BlueLeaks, May 1, 2020 (“FBI bulletin”); Llyod, “FBI Concerned over Laundering Risks.”
- See Financial Crimes Enforcement Network, “Anti-Money Laundering Program and Suspicious Activity Report Filing Requirements for Registered Investment Advisers,” Federal Register 80, no. 169 (September 1, 2015), pages 52680-52701.
- These are all types of investment advisors that are not required to register with the SEC because they investment funds that they advise are limited in nature, making them less relevant for the SEC’s mandate of nationwide investor protection. See Regulation of Investment Advisers by the U.S. Security and Exchange Commission (Washington: U.S. Securities and Exchange Commission, March 2013), pages 9 and 11-17.
- See FinCEN, “AML and SAR Requirements for Registered Investment Advisors,” page 52681.
- See Lakshmi Kumar and Kaisa de Bel, Acres of Money Laundering: Why U.S. Real Estate is a Kleptocrat’s Dream (Washington: Global Financial Integrity, August 2021), pages 6-7 and 13-33.
- See Craig Unger, “Trump’s Russian Laundromat,” The New Republic, July 13, 2017.
- See Louise Story and Stephanie Saul, “Towers of Secrecy: Streams of Foreign Wealth Flows to Elite New York Real Estate,” The New York Times, February 7, 2015; U.S. Treasury Department, Financial Crimes Enforcement Network, “FinCEN Takes Aim at Real Estate Secrecy in Manhattan and Miami,” press release, January 13, 2016.
- See National Strategy for Combating Terrorist and Other Illicit Financing (Washington: U.S. Treasury Department, February 6, 2020) (“Treasury 2020 National Strategy”), page 16.
- See Casey Michel, American Kleptocracy: How the U.S. Created the World’s Greatest Money Laundering Scheme in History (New York: St. Martin’s Publishing Group, 2021), part III.
- U.S. House, National Defense Authorization Act for Fiscal Year 2021, sec. 6403(a).
- See United States Senate, Permanent Subcommittee on Investigations, Committee on Homeland Security and Governmental Affairs (“PSI”), The Art Industry and U.S. Policies That Undermine Sanctions, July 2020, page 114.
- Ibid, pages 79-105.
- See Michel, chapters 8-9.
- See U.S. House, National Defense Authorization Act for Fiscal Year 2021, sec. 6110(d).
- Lowering the Bar: How American Lawyers Told Us How to Funnel Suspect Funds into the United States (Washington: Global Witness, January 2016), pages 1, 6, and 8.
- See Tom Wright and Bradley Hope, Billion Dollar Whale: The Man Who Fooled Wall Street, Hollywood, and the World (New York: Hachette Books, 2019), pages 85-88; United States of America v. Certain Rights to and Interests in the Viceroy Hotel Group, no. 17-4438 (C.D. Cal. 2017) (“United States v. Viceroy Hotel”), pages 41-43 and 134-149; United States of America v. “The Wolf of Wall Street” Motion Picture, no. CV 16-16-5362 (C.D. Cal. 2016) (“United States v. The Wolf of Wall Street”), pages 35-37 and 83-98.
- See Michel, chapter 7; PSI, Keeping Foreign Corruption Out of the United States: Four Case Histories, February, 2010, pages 26-73.
- See Alexander Cooley and Casey Michel, “U.S. Lawyers Are Foreign Kleptocrats’ Best Friends,” Foreign Policy, March 23, 2021; Kumar and Bel, Acres of Money Laundering, pages 29-31 and 50-55; Money Laundering and Terrorist Financing Vulnerabilities of Legal Professionals (Paris: Financial Action Task Force, June 2013).
- See “Task Force on Gatekeeper Regulation and the Profession,” American Bar Association, accessed August 17, 2021; “Real Property, Trust and Estate Law Section,” American Bar Association, accessed August 17, 2021; Kevin Shepherd, “Guardians at the Gate: The Gatekeeper Initiative and the Risk-Based Approach For Transactional Lawyers,” Real Property, Trust & Estate Law Journal 43, no. 4 (Winter 2009), pages 607-671; Laurel S. Terry and José Carlos Llerena Robles, “The Relevance of FATF’s Recommendations and Fourth Round of Mutual Evaluations to the Legal Profession,” Fordham international Law Journal 42, no. 2 (2018); “The Voice of Small Business,” NFIB, accessed August 17, 2021; Matthew Stephenson, “Why Does the American Bar Association Oppose Beneficial Ownership Transparency Reform?” The Global Anticorruption Blog, March 9, 2018; Matthew Stephenson, “The Flawed and Flimsy Basis for the American Bar Association’s Opposition to Anonymous Company Reform,” The Global Anticorruption Blog, February 6, 2018; Nathanael Tilahun Ali, “States’ Varied Compliance with International Anti-money Laundering Standards for Legal Professionals,” Nordic Journal of International Law 88, no. 2 (April 24, 2019), pages 289-294.
- See United States: Mutual Evaluation Report (Paris: The Financial Action Task Force, December 2016) (“U.S. 2016 FATF MER”), pages 31-32; Michael Findley, Daniel Nielson, and James Sharman, Global Shell Games: Testing Money Launderers’ and Terrorist Financiers’ Access to Shell Companies (South East Queensland, Australia: Griffith University, 2014), page 8.
- See Oliver Bullough, Moneyland: The Inside Story of the Crooks and Kleptocrats Who Rule the World (United States: St. Martin’s Publishing Group, 2019), pages 75-76.
- Findley, Nielson, and Sharman, Global Shell Games, pages 18 and 21.
- Ibid, page 24.
- Ibid, page 15.
- See Guidance for a Risk-Based Approach: Trust and Company Service Providers (Paris: Financial Action Task Force, June 2019), pages 7-8.
- See Gil Troy, “The Bean Counter Who Put Al Capone in the Slammer,” The Daily Beast, August 25, 2017; Raymond Bonner, “Russian Gangsters Exploit Capitalism to Increase Profits,” The New York Times, July 25, 1999; Christine Duhaime, “The Un-Talked about Sector in Money Laundering Cases – The Accountant,” Duhaime’s Anti-Money Laundering Law in Canada, June 23, 2019; Lara Loaiza and Maria Alejandra Navarrete, “’Contador’ – Colombia’s Sought after Parton of Cocaine,” InSight Crime, February 20, 2020; Michel, chapter 12; Supreme Court of the State of New York, County of New York, The People of the State of New York against the Trump Organization, July 1, 2021; Sydney Freedberg, et al., “How Africa’s Richest Woman Exploited Family Ties, Shell Companies and Inside Deals to Build an Empire,” International Consortium of Investigative Journalists, January 19, 2020.
- See Freedberg, et al., “How Africa’s Richest Woman Exploited Family Ties.”
- See Forsythe, et al., “How U.S. Firms Helped Africa’s Richest Woman;” Freedberg, et al., “How Africa’s Richest Woman Exploited Family Ties.”
- See Juliette Garside and Phillip Inman, “PwC under Growing Scrutiny as Scandal Engulfs Isabel dos Santos,” The Guardian, January 23, 2020; Forsythe, et al., “How U.S. Firms Helped Africa’s Richest Woman.”
- See U.S. 2016 FATF MER, page 220.
- Guidance for a Risk-Based Approach: Accounting Profession (Paris: Financial Action Task Force, June 2019), pages 10-13 and 34-35.
- See Max Fisher, “Disinformation for Hire, a Shadow Industry, Is Quietly Booming,” The New York Times, July 25, 2021; Craig Silverman, et al., “Disinformation for Hire: How a New Breed of PR Firms Is Selling Lies Online,” BuzzFeed News, January 6, 2020; Shelby Grossman and Khadeja Ramali, “Outsourcing Disinformation,” Lawfare Blog, December 13, 2020; “A US PR Firm Steps into Contested Elections,” Stanford Internet Observatory, September 4, 2020, pages 5-6.
- See Isaac Stanley-Becker, “Facebook Bans Marketing Firm Running ‘Troll Farm’ for Pro-Trump Youth Group,” The Washington Post, October 8, 2020; “Analysis of an October 2020 Facebook Takedown Linked to U.S. Political Consultancy Rally Forge,” Stanford Internet Observatory, October 8, 2020.
- See Charlie Haynes and Flora Carmichael, “The YouTubers Who Blew the Whistle on an Anti-Vax Plot,” BBC, July 25, 2021; July 2021 Coordinated Inauthentic Behavior Report (Menlo Park: Facebook, August 10, 2021); Antoine Daoust, “Russia behind an anti-Pfizer Lobbying Campaign?” Fast & Furious, May 24, 2021.
- See Craig Silverman, “The Philippines Was a Test of Facebook’s New Approach to Countering Disinformation. Things Got Worse,” BuzzFeed News, August 7, 2019; Jonathan Corpus Ong, et al., Tracking Digital Disinformation in the 2019 Philippine Midterm Election (New Mandala, August 2019); Lauren Etter, “What Happens When the Government Uses Facebook as a Weapon?” Bloomberg News, December 7, 2017; Shibani Mahtani and Regine Cabato, “Why crafty Internet trolls in the Philippines may be coming to a website near you,” The Washington Post, July 26, 2019.
- See “Exempted anti-money laundering programs for certain financial institutions,” 67 FR 21113, Apr. 29, 2002, as amended at 67 FR 67549, Nov. 6, 2002; 67 FR 68935, Nov. 14, 2002; 73 FR 1976, Jan. 11, 2008 (“31 C.F.R. 103.170”).
- See PSI, Keeping Foreign Corruption Out, pages 73-85; Michel, chapter 7.
- See Michel, chapters 4 and 10.
- See Oren Dorell, “Why Does Donald Trump Like Russians? Maybe Because They Love His Condos,” USA Today, December 15, 2016; Caleb Melby and Keri Geiger, “Behind Trump’s Russia Romance, There’s a Tower Full of Oligarchs,” Bloomberg News, March 16, 2017; Nathan Layne, Ned Parker, et al., “Russian Elite Invested Nearly $100 Million in Trump Buildings,” Reuters, March 17, 2017; Tom Hamburger, et al., “In ‘Little Moscow,’ Russians Helped Donald Trump’s Brand Survive the Recession,” The Washington Post, November 4, 2016.
- See Thomas Frank, “Secret Money: How Trump Made Millions Selling Condos to Unknown Buyers,” BuzzFeed News, January 12, 2018.
- See FATF, U.S. 2016 FATF MER, page 122.
- See United States District Court for the Central District of California, United States v. One White Crystal Covered “Bad Tour” Glove and Other Michael Jackson Memorabilia; One White Crystal-Covered “Bad Tour” Glove and Other Michael Jackson Memorabilia; One Gulfstream G-V Jet Airplane Displaying Tail Number VPCES; Real Property Located on Sweetwater Mesa Road in Malibu, California; One 2007 Bentley Azire; One 2008 Bugatti Veyron; One 2008 Lamborgini Murcielago; One 2008 Rolls Royce Drophead Coupe; One 2009 Rolls Royce Drophead Coupe; One 2009 Rolls Royce Phantom Coupe; One 2011 Ferrari 599 GTO, April 26, 2011 (“United States v. Bad Tour Glove”), pages 3-4, 8-15, 19-21, and 24-28; Michel, chapter 1 and chapter 8.
- See PSI, Keeping Foreign Corruption Out, pages 23, 37, and 47; Michel, chapter 8.
- See PSI, Keeping Foreign Corruption Out, pages 85-97; Michel, chapter 8.
- See Michel, chapter 8.
- See Financial Crimes Enforcement Network, “Requirements for Certain Transactions Involving Convertible Virtual Currency or Digital Assets,’” Federal Register 85, no. 247 (December 23, 2020), pages 83841 and 83843; Nicole Perlroth, et al., “Pipeline Investigation Upends Idea That Bitcoin Is Untraceable,” The New York Times, June 9, 2021.
- See Financial Crimes Enforcement Network, “Threshold for the Requirement To Collect, Retain, and Transmit Information on Funds Transfers and Transmittals of Funds That Begin or End Outside the United States, and Clarification of the Requirement To Collect, Retain, and Transmit Information on Transactions Involving Convertible Virtual Currencies and Digital Assets With Legal Tender Status,” Federal Register 85, no. 208 (October 27, 2020), pages 68005-68019.
- See U.S. Department of Justice, “California CEO and Seven Others Charged in Multi-Million Dollar Conduit Campaign Contribution Case,” press release, December 3, 2019; Jake Pearson and Jeff Horwitz, “How a Business Serving Bettors, Porn Donated to Dems, Trump,” Associated Press, August 2, 2018; United States District Court for the District of Columbia, United States of America vs. Ahmad ‘Andy’ Khawaja, May 7, 2019 (“United States v. Andy Khawaja”); Paul Wood, “Andy Khawaja: ‘The Whistleblower’,” Spectator World, February 24, 2020.
- See FinCEN, “Threshold for the Requirement To Collect, Retain, and Transmit Information,” pages 68005-68019.
- See FinCEN, “Requirements for Certain Transactions,” pages 83840-83862.
- See Treasury 2020 National Strategy, page 13; “Risk Associated with Third-Party Payment Processors,” FinCEN Advisory, October 22, 2012.
- Josh Rudolph, “Biden Puts Oligarchs on Notice,” The Alliance for Securing Democracy (blog), June 7, 2021.
- While the United States is ranked second based on the Financial Secrecy Index (FSI), it is ranked first based on the Global Scale Weight, meaning that U.S. companies provide the world’s largest share of offshore financial services. See “Financial Secrecy Index,” Tax Justice Network, February 18, 2020.