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U.S. should support global efforts to tackle financial crime

A statement from the U.S. office of Transparency International

At its plenary meeting this week in Paris, the Financial Action Task Force (FATF) will decide whether to review its recommendations for regulating anonymous “shell companies” that are often used to disguise terrorist financing and to launder the proceeds of corruption and organised crime.

Transparency International is standing with other civil society organizations, including Global Witness, the Tax Justice Network, the B-Team, and Open Ownership, in calling on delegates to the FATF plenary to support the proposed review. The organizations are urging delegates to support proposals that require those who benefit from a company’s activities (known as the company’s “beneficial owners”) to be named in a verified, central register.

Gary Kalman, Director of the U.S. office of Transparency International, issued the following statement:

“In its 2020 strategy on combatting illicit finance published last week, the Trump Administration called on Congress to pass legislation this year that permits law enforcement authorities to know who controls a company from the moment it is formed.

The US has significant clout at the FATF meetings. We strongly urge the Administration to take its support for new and meaningful beneficial ownership standards to this important forum, and call on FATF members to adopt similar standards across the world.

By allowing criminals and the corrupt to hide their activities, anonymously held companies wreak havoc in the global financial system and threaten U.S. national security. By getting behind the proposed review in Paris this week, the U.S. can support the work of law enforcement agencies tackling financial crime both here at home and around the world.”

Notes to editors:

The FATF is proposing to review Recommendation 24, which requires member countries to ensure that authorities have timely access to adequate, accurate, and up-to-date beneficial ownership information. A 2019 study by Transparency International found that of the 83 countries assessed by FATF since 2014, only one fully complies with Recommendation 24. No country is considered to be ‘highly effective’ in this area.

  • Click here to read the joint statement by Transparency International, Global Witness, the Tax Justice Network, the B-Team, and Open Ownership.
  • Click here to read the US Treasury’s announcement of its new Illicit Finance Strategy.
  • Click here to read Transparency International’s 2019 report ‘Who’s behind the wheel? Fixing the global standards on company ownership’. (Press Release)
  • Click here to read an opinion piece by the President of FAFT on anonymous company ownership (Financial Times paywall).

Scott Greytak, Advocacy Director, Transparency International—U.S. Office
T: +1 614-668-0258
E: [email protected]
@transparencyUSA