FBI STATEMENT: COMBATING ILLICIT FINANCING BY ANONYMOUS SHELL COMPANIES

On 21st May, Steven D’Antuono, the Acting Deputy Assistant Director of the FBI’s Criminal Investigative Division, gave an extensive Statement to the US Congress, saying that the estimated $2 trillion of worldwide illicit proceeds is increasingly utilising the anonymity of shell and front companies to obscure the true beneficial ownership of an entity.  He said that the pervasive use of shell companies, front companies, nominees, or other means to conceal the true beneficial owners of assets is a significant loophole in this country’s AML regime.  He pointed out that, not only does the state-level regime lack beneficial ownership information, no federal-level system exists to consolidate or supplement the information that is collected under the various state regimes.  Moreover, except in very narrow circumstances, current federal laws do not require identification of beneficial owners at account opening with financial institutions.  He identified potential means to mitigate the situation.  In doing so, he remarked that the UK has enacted perhaps the most robust beneficial ownership legislation to date (which some might find a surprising remark!).  he also noted the bilateral agreements between the UK and the Crown Dependencies and Overseas Territories related to the sharing of beneficial ownership information – saying that colleagues at the UK NCA have continually noted the immense value of such information in their investigations.  He went on to detail some cases hindered by the lack of beneficial ownership information.

https://www.fbi.gov/news/testimony/combating-illicit-financing-by-anonymous-shell-companies

Author: raytodd2017

Chartered Legal Executive and former senior manager with Isle of Man Customs and Excise, where I was (amongst other things) Sanctions Officer (for UN/EU sanctions), Export Licensing Officer and Manager of the Legal-Library & Collectorate Support Section

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