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Rubio Secures Provision in Defense Bill to Combat Financial Crime by Ending Anonymous Shell Companies

Dec 11, 2020 | Press Releases

Washington, D.C. — U.S. Senator Marco Rubio (R-FL) secured a provision in the National Defense Authorization Act (NDAA) for Fiscal Year 2021 (H.R. 6395) conference report that passed the Senate that will help stop criminals, including sophisticated criminal organizations, from using anonymous shell corporations to engage in illicit activities like money laundering, sex trafficking, fraud, and terrorist financing. The anti-money laundering provisions in the FY21 NDAA conference report includes and builds upon the Corporate Transparency Act (S. 1978), bipartisan legislation he reintroduced last year. The Senate’s action sends the final conference report to the President.
Senator Rubio first introduced the bipartisan Corporate Transparency Act with Senator Ron Wyden (D-OR) in August 2017. In August 2018, Rubio, Wyden, and Senator Sheldon Whitehouse (D-RI) succeeded in passing bipartisan legislation to lay the groundwork to expand a U.S. Department of the Treasury initiative to curb foreign nationals laundering money through high-end real estate. The Miami Herald also published an in-depth report on Rubio’s continued efforts to crackdown on dirty money in real estate.
“In my home State of Florida, including in Miami, our law enforcement professionals know all too well that criminals readily use shell companies to remain anonymous and hide nefarious activity,” Rubio said. “I was proud to help secure this important provision in the NDAA that targets criminals hiding behind shell companies to engage in illicit activities like human trafficking, healthcare fraud, transnational corruption, and terrorist 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.”
Last December, Rubio chaired a Senate Foreign Relations Subcommittee on Western Hemisphere, Transnational Crime, Civilian Security, Democracy, Human Rights, and Global Women’s Issues hearing titled “Illicit Mining: Threats to U.S. National Security and International Human Rights.” The hearing examined how anonymous shell corporations are used to engage in illicit activity, including money laundering.
Specifically, the Corporate Transparency Act will:

  • Generally require basic information, including name, address, date of birth, and a driver’s license number or other identification of the beneficial owner be reported to the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) upon the creation of a company, with some exceptions. No financial information, business details, or proprietary information is required;
  • Ensure government authorities accessing beneficial ownership information do so only for authorized purposes;
  • Minimize reporting burdens for companies; and
  • Provide for civil and criminal penalties for willful violations of the requirements under this law.