Anti-corruption LLC disclosure law part of Senate, House override of defense bill

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An anti-corruption measure that would end anonymous companies in the United States is slated to became law.

Suspect LLCs, some tied to drug kingpins, dictators, and money launderers were often incorporated in Delaware, a state that for many years had minimal disclosure requirements.

Recently Delaware tightened its disclosure laws and took away charters under a law passed by the General Assembly. Revoked charters included those arranged by former Trump campaign chief Paul Manafort and the president’s former personal lawyerMichael Cohen.

In resisting added disclosures over the years, Delaware officials had called for federal legislation that would discourage sketchy corporate entities moving to states with the fewest disclosure requirements.

Nevada, South Dakota and other states have worked to lure Delaware corporations to their domiciles.

The Corporate Transparency Act was included in the National Defense Authorization Act. The House and Senate on New Years Day voted to override President Trump’s veto of the act.

Ian Gary, executive director of the FACT Coalition stated,“For years, experts routinely ranked anonymous shell companies — where the true, ‘beneficial’ owners are unknown — as the biggest weakness in our anti-money laundering safeguards. Virtually every national security expert, law enforcement official, and human rights advocate that looked at the issue called for an end to anonymous companies.

Gary concluded,“The campaign was so successful that the State of Delaware and the U.S. Chamber of Commerce — both of which had previously opposed reform — ultimately endorsed transparency.”

The FACT Coalition had pushed for the disclosure requirements for a decade.

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