Corporate Transparency Act of 2019

Floor Speech

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Mr. FOSTER. Mr. Chairman, I thank the chairwoman for yielding, and I thank my friend from New York, Chairwoman Maloney, for her leadership on this issue.

Mr. Chairman, I rise in support of H.R. 2513, which would help to end the abuse of anonymous shell companies. These entities have a well- documented history of being used to hide money in a wide variety of crimes, including sanctions evasion, terrorist financing, human trafficking, drug trafficking, illegal arms dealing, tax evasion, and corruption. Anonymous shell corporations are also being subverted by criminals in ever-evolving schemes involving emerging digital technologies.

One of the many hats that I wear is being a co-chair of the Blockchain Caucus. Just in the past week, I have had disquieting updates from officials from the FBI and FinCEN about trends in the abuse of cryptocurrencies for nefarious purposes.

What was clear from these briefings is that the use of anonymous shell companies has greatly inhibited the ability of law enforcement to go after criminals who use cryptocurrency to engage in illicit financing. The use of anonymous shell companies also makes it extremely difficult to uncover abusive trading practices in unregulated crypto exchanges.

In short, criminals and law enforcement officers are engaged in a very sophisticated cat-and-mouse game in which law enforcement is always playing catch-up. Passing the Corporate Transparency Act will give law enforcement officers a significant new tool that could potentially lead them to taking down more of the bad guys.

Let us not forget, the use of the beneficial ownership registries is not some wild-eyed, crazy concept where the U.S. would be going out on a limb. This is an area where the U.S. is significantly behind other developed nations.

The Financial Action Task Force, a respected intergovernmental policymaking body established by the G7 countries in 2016, gave the U.S. a failing grade for its efforts to prevent the laundering of criminal proceeds by shell companies. According to FATF's report, the U.S. has not done enough to rein in corporate secrecy, which presents serious gaps in law enforcement efforts, leaving our financial system vulnerable to dirty money.

They were blunt. We were scored as noncompliant--the lowest possible score--on our ability to determine the true owners of shell companies. That is simply unacceptable.

I would like to think that the U.S. should be a standard setter amongst nations when it comes to things like anti-money laundering enforcement. The current status quo, however, woefully fails to measure up to our lofty goals. We need to do better, and that is why I support the commonsense measures put forth in H.R. 2513.

Mr. Chairman, I thank Congresswoman Maloney for her determined and dogged leadership on this issue for many years, and I urge a ``yes'' vote on H.R. 2513.

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