Over the last thirty years, the United States has become a world leader in financial secrecy and a haven for international corruption and dirty money. Congress took action to rebuild our defenses and empower law enforcement to fight money laundering and terrorist financing by passing the Corporate Transparency Act (CTA), which is a first step towards designing a legal regime to protect the nation from malicious actors intent on sheltering their ill-gotten gains.

Previously, CREW called on FinCEN to make the bold changes necessary to combat corruption and the influence of untraceable money on our country, and specifically, to design a regulatory framework that rises to the level of the challenges we face. With their proposed rule, FinCEN has succeeded in every possible respect. Their proposed rule is a blueprint for a twenty-first century anti-money laundering regime.

CREW has submitted a comment encouraging FinCEN not to be swayed by those who would seek to weaken this rule in service of their personal financial interests, and in particular not to make substantial changes to the proposed rule that weaken the definition of beneficial ownership, the definition of domestic reporting companies, or that expand the number of exemptions to the statute.

The proposed rule reflects much of what CREW suggested in our previous comment. For example, the “substantial control” test FinCEN developed adopts some of the best practices CREW pointed to in our previous comment. FinCEN did not add any additional exemptions beyond those specifically outlined in the CTA, which we suggested since every additional exemption creates new opportunities for savvy and malicious actors to find gaps and loopholes within the framework.

FinCEN has the opportunity to pass a bold and comprehensive rule that will revolutionize our country’s ability to combat illicit finance, in a stroke transforming the United States from one of the worst jurisdictions in the world for money laundering into one of the world’s leaders. We urge FinCEN to pass the proposed rule without any additional exemptions that might weaken this otherwise monumental move.

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