Statement: Congress’ veto override cements huge win against money laundering

WASHINGTON — The U.S. Senate voted Friday to override the president’s veto of the National Defense Authorization Act (NDAA). Combined with a similar House vote Monday night, that makes the NDAA law. The Act includes critical reforms to thwart money laundering, previously contained in the Corporate Transparency Act, and also closes a loophole  which allowed people to form a company in all 50 states with no record of who owned or benefitted from that entity. 

Now, the true owner of all new and existing companies must both register with the U.S. Treasury and update that filing whenever the company changes hands. Without this regulation, anonymous shell companies became a nearly ubiquitous tool for hiding dirty money. From terrorist financing to Medicare scams, shell companies have shielded the identities of wrongdoers and served as their financial getaway cars. 

U.S. PIRG, a founding member of the Financial Accountability and Corporate Transparency (FACT) Coalition, has backed federal legislation to close these loopholes for a decade. We also worked with our state affiliates around the country to support federal legislation, including organized support from dozens of state attorneys general. 

In response to the NDAA passing, U.S. PIRG Campaign Director Nathan Proctor issued the following statement: 

“This landmark victory against dirty money goes to show that a good idea — and a dedicated group of advocates — can make real progress, even in the face of our current partisan division. 

“Make no mistake:  This is a historic win. It’s not a mystery why criminal enterprises traffic illicit goods or commit fraud. They do it for the money. The fact that anyone could create a company with no record of who owned it made it far too easy to move dirty money. This game-changing win is a blow to this criminal activity. 

“We want to thank our coalition partners and the other members of the FACT Coalition, and it’s excellent staff. We also want to thank our legislative champions in Congress for their historic votes.”