Wyden, Rubio, Whitehouse Bill Would Combat Financial Crime by Ending Anonymous Shell Companies

Washington, D.C. – Senate Finance Committee Ranking Member Ron Wyden, D-Ore., Senator Marco Rubio, R-Fla., and Senator Sheldon Whitehouse, D-R.I., today introduced legislation to combat money laundering, terrorist financing and other financial crimes by ending the anonymity of shell companies.

The bill would require corporations and limited liability companies (LLCs) to disclose their beneficial owners to FinCEN at formation by providing basic biographical information like name, date of birth, address and driver’s license or passport number.

Existing companies will be required to file a list of current beneficial owners annually and report changes in ownership.

Individuals who fail to provide beneficial ownership information or willfully provide false information would be subject to civil and criminal penalties.

“Anonymous shell companies have facilitated rampant criminality, including real estate deals being used to launder illicit funds,” Wyden said. “Our bill would provide a straightforward solution by ending the anonymity and registering the owners of these companies on day one. Ending anonymous shell companies would make it easier for law enforcement to ‘follow the money’ when investigating complex financial crimes.”

“Law enforcement in my home state of Florida, including in Miami, know all too well that criminals readily use shell companies to remain anonymous and hide nefarious activity,” Rubio said. “I am proud to reintroduce this bipartisan bill that targets criminals hiding behind shell companies to engage in illicit activities like human trafficking, healthcare fraud, transnational corruption, and terrorism financing. It is imperative that law enforcement has the basic information, tools, and authorities at its disposal to identify and disrupt criminal acts that put our communities and our national security at risk.”

“The United States has become a haven for shell corporations, allowing everyone from domestic criminals to foreign strongmen to obscure their ill-gotten gains in our financial system,” Whitehouse said. “It’s common sense that law enforcement needs the ability to identify the actual owner of any American corporation, and that America should not be a financial haven for the world’s worst people.”

Many legitimate businesses will be exempt from the reporting requirements, including publicly traded companies, 501(c) organizations and small businesses operating in the United States with 20 employees and $5 million in gross receipts.

Beneficial ownership transparency has been endorsed by the Financial Accountability & Corporate Transparency (FACT) Coalition, as well as a broad group of businesses, nonprofit organizations, unions and law enforcement.

A copy of the bill text is available here.

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