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The United States eliminated a major channel for money laundering and tax evasion through a new law that now requires the names of shell company owners to be revealed, widely used to hide billions of dollars from the treasury.
The so-called Corporate Transparency Act was included in the US defense appropriations bill approved by Congress on Friday night, bypassing President Donald Trump’s veto.
“This is the most important step we could take to better protect our financial system from abuse,” said Ian Gary, executive director of the FACT Coalition, which pushed for the regulation’s approval.
Front business owners must, under this law, give their identity to an agency of the United States Department of the Treasury, the Financial Crimes Enforcement Network (FinCEN).
“For years, experts routinely ranked anonymous shell companies … as the greatest weakness in our safeguards against money laundering,” Gary said.
Only the Treasury Department and the police will have access to this information, so it will always be protected from the general public. But for transparency advocates, this is already a big step forward against corruption, organized crime and tax evasion.
While much attention has been paid to tax havens such as Panama or the Cayman Islands, experts argue that the size of the US economy, and therefore its ability to absorb billions of dollars relatively unnoticed, became a central element to transform illicit funds into clean money.
In early 2020, the Tax Justice Network ranked the Cayman Islands and the United States as the champions in enabling the concealment of finances from the eyes of the law and tax collection.
The United Nations estimates that between $ 800 billion and $ 2 trillion are laundered each year through the global financial system.
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