Thread by @Heidi_Cuda

SUNLIGHT ON DARK MONEY: A bipartisan push to pass anti-money laundering legislation in America sees daylight

by Heidi Siegmund Cuda
maewestside.tumblr.com/post/636949192…

1/ Throw a rock, hit a shell. 

When spelunking down rabbit holes to investigate corruption, the anonymous, shadowy world of shell companies often leads to cryptic deadends. According to retired IRS investigator, Martin Sheil, it’s corruption by design.

2/ “The fact of the matter U. S. has become 'the' ultimate money laundering destination of choice for the kleptocrats, oligarchs, drug dealers, organized crime figures and corrupt politicians worldwide,” says Sheil.

3/ Sheil continues: “Not Switzerland. Not Estonia or Latvia nor Cyprus although the Russians might cavil with that assertion.

3/ “Anonymous investment in real estate via shell companies within big cities safely ensconced in fortress America became the popular choice worldwide of those noted above who possessed sources of nefariously obtained income,” says Sheil.

4/ That choice is now challenged. A bipartisan push in Congress to pass anti-money laundering legislation resulted in last week’s insertion of multiple bills requiring companies to disclose beneficial owners into the National Defense Authorization Act, a must-pass defense bill.

5/ “It is beyond about time,” says Sheil. “To quote Robert Frost, it’s ‘a momentary stay against confusion.’"

6/ Congresswoman Carolyn Maloney (D-NY) has been trying to pass anti-money laundering legislation for 12 years, and her Corporate Transparency Act was among the bills inserted into the NDAA.

7/ “The bill will crack down on anonymous shell companies, which have long been the vehicle of choice for money launderers, terrorists, or criminals,” she said in a statement.

8/ “The bill will finally allow law enforcement to follow the money in their investigations, and will prevent terrorists, kleptocrats, and other bad actors from using the U.S. financial system to hide their dirty money,” said Maloney.

9/ Senator Mark Warner’s ILLICIT CASH Act was also inserted into the NDAA, and like Maloney’s bill, he’s seeking to make it easier to track criminal activity, improve corporate transparency, and strengthen national security.

10/ “As the Vice Chairman of the Senate Intelligence Committee, I know that the current holes in our financial system pose a serious threat to national security,” Warner said in a statement.

11/ “The ILLICIT CASH Act will seek to patch those holes… handing federal agencies the 21st-century tools they need to combat these 21st century threats,” said Warner.

12/ The poetic justice of anti-money laundering legislation being inserted into an annual defense bill is not lost on Sheil, who spent 30 years at the IRS, retiring as Supervisory Special Agent in the Criminal Investigation Division.

13/ “I recall Jonathan Viner, Deputy Assistant Secretary of State for International Law Enforcement in the Clinton administration, quoted as saying in regard to the rise of luxury real estate to launder money, ‘It didn't matter that you paid too much because real estate values...

14/ “‘...because real estate values would rise, and it was a way of turning dirty money into clean money,’” says Sheil.

15/ “Viner was further quoted as saying, ‘It was done very systematically and it explained why there were so many high rises where the unit was sold, but no one is living in them,’” say Sheil.

16/ Sheil says cash purchases of a luxury property via shell companies with no requirement to reveal the beneficial owner was a key method to launder foreign, ill-gotten gains.

17/ “Banks who have a requirement in their anti-money laundering responsibility to ‘know their customer,’ will be greatly assisted by the requirements of the legislation,” says Sheil. “Folks who make their living selling luxury condos may have to adjust.”

18/ In a recent editorial published in The Hill, Congresswoman Maloney wrote: “Beyond the impacts for law enforcement, this bill will directly affect us here at home by lowering housing costs in New York City.”
thehill.com/blogs/congress…

19/ Maloney explains how criminals using shell companies routinely park illicit money in luxury real estate, which limits housing availability and drives up costs.

20/ Among the condos sold in all cash transactions to anonymous shell companies were more than 1,300 Trump condominiums, according to a Buzzfeed News investigation.
buzzfeednews.com/article/thomas…

21/ “We’re the only advanced country in the world that doesn’t already require disclosure of this information, and frankly, it’s an embarrassment. We must fix this in the final NDAA,” wrote Maloney in The Hill.

22/ Sheil says money laundering, like life, will continue to evolve.

23/ “How long will it take to regulate Bitcoin once the big corporations and tech companies with their political contribution potential get involved to muddy regulatory waters?” queries Sheil. “The major attraction of Bitcoin is the Anonymity associated with it. Sound familiar?”

24/ He says the bad guys will adapt, and so too must Uncle Sam. He cautions that unless money laundered is tackled head on, the U.S. tax system will further erode and society will further stratify.

25/ “I hope that does not happen and we have learned our lesson,” says Sheil. “But hope is the key word there...

26/ “To quote Joe Biden quoting Seamus Heany, ‘History says, Don't hope on the side of the grave… But then, once in a lifetime, The longed for tidal wave, Of justice can rise up, Believe in miracles, And cures and healing well.”

27/ It is, after all, the season of miracles. Let’s see if Congress can make one.

—Author Heidi Siegmund Cuda is an Emmy award-winning investigative reporter.
maewestside.tumblr.com/post/636949192…

28/ CODA—To read more of my interviews with retired IRS investigator, please chk out:

https://twitter.com/BylineTimes/status/1333836677337534467

29/ More rabbit holes:

https://twitter.com/heidi_cuda/status/1211481839602286592

Cc
@RepMaloney
@MarkWarner