State to work with U.S. Treasury unit in sniffing out sketchy limited liability companies

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The U.S. Department of the Treasury and the State of Delaware announced a Memorandum of Understanding regarding overseas limited liability companies.

The agreement was reached with Treasury’s Office of Foreign Assets Control.

This MOU calls for the sharing of information and other steps.

Over the years, Delaware became a haven for LLCs that have been linked to drug kingpins, criminal enterprises and more recently officials involved in the Trump presidential campaign.

The state has been widely criticized over the years for requiring minimal disclosure of information in its lucrative corporate formation business.

Of late, the state has since passed legislation and taken other steps to discourage shady LLCs.

“Delaware is recognized nationally and globally as a critical venue in the business community,” said Delaware Attorney General Kathy Jennings. “We take that role, and the responsibility that accompanies it, seriously. Delaware and OFAC’s partnership is a new chapter in a longstanding collaboration against abuse, and for the rule of law. We will not enable criminal enterprise in this State, and we are grateful for OFAC’s assistance in ensuring that the advantages of doing business in Delaware are not abused to break the law.”

“The Delaware Division of Corporations already cooperates regularly with our partners in federal law enforcement, including OFAC, to root out illegal activity connected to our state’s business registry,” said Delaware Secretary of State Jeffrey Bullock. “In recent years, we have changed state laws and regulations and stepped up our work with the Department of Justice to shut down Delaware corporations and LLCs connected to illegal activity. This agreement builds on that progress, and I thank Attorney General Jennings for her commitment to this objective.”

Under the agreement, OFAC and the Delaware Department of Justice will maintain frequent communication and meet as needed as part of the agencies’ efforts to identify and shut down entities on the SDN List or that are otherwise blocked.

View a copy of the MOU here.

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