Maloney takes aim at shell corporations funding terror groups

Congresswoman Carolyn Maloney and District Attorney Cyrus Vance at City Hall (Photo by Maria Rocha-Buschel)

Congresswoman Carolyn Maloney and District Attorney Cyrus Vance at City Hall (Photo by Maria Rocha-Buschel)

By Maria Rocha-Buschel

Congresswoman Carolyn Maloney called on Congress to prevent anonymous shell corporations from laundering money on behalf of criminals and terrorist organizations this past Monday.

Maloney was joined by Manhattan District Attorney Cyrus Vance and former FBI special agent Konrad Motyka, who voiced their support for legislation that the congresswoman introduced in February that would expose the anonymous corporations.

Maloney emphasized that transparency would prevent criminals from hiding their identities behind these shell corporations.

“When investigators are tracking illegal activity, they’ll hit a shell corporation and won’t be able to figure out who it is,” she said. “There’s no way to tell if it’s a foreign dictator or a drug cartel.”

Vance noted that the anonymity provided by these shell corporations is due to a glaring loophole, while there are protections in place against money laundering elsewhere.

“If you want to open a bank account, it’s more information that you need to provide than if you want to open a corporation and move millions of dollars,” he said. “It’s time that states stood up and said that the minimum info is at least required.”

Konrad Motyka, a former FBI Special Agent and a representative from the Society of Former Special Agents of the FBI, agreed that corporations should be held to the same standards as banks in foreign countries, which are required to report on funds and accounts held by American citizens.

“We cannot hold ourselves out to be a nation of laws and financial stability without the needed reforms being sought by this legislation,” he said. “The Society stands behind this bipartisan effort to make our financials more transparent, effective and free of terrorist and criminal financial influence.”

Maloney proposed the legislation at the beginning of February, not long after an undercover investigation by Global Witness, a nonprofit activist organization that is pushing for more strict money-laundering laws. The organization was featured in a recent segment on 60 Minutes and in a report in the New York Times at the end of January.

The investigation found that lawyers at 12 of the 13 law firms willingly suggested ways to move suspicious funds into the United States. The report in the New York Times noted that real estate is one industry that has been under particular scrutiny because of the large amount of cash flowing into luxury development.

“The level of ineptitude in dealing with this problem in Washington is shocking,” Maloney said of the issue. “My bill simply says, if you want to form a corporation in the United States, tell us who really owns it. I think the American people would be shocked to learn that isn’t the law already.”

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