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Panama Papers’ Anonymous Shell Companies an American Problem, Too

For Immediate Release

Baltimore, 4/13/2016- The International Consortium of Investigative Journalists revealed a massive data dump leaked from the Panamanian law firm Mossack Fonseca detailing the formation of an enormous network of anonymous shell companies last week.  A considerable number of the companies Mossack Fonseca created were used for nefarious purposes, including tax dodging and money laundering, forcing the resignation of one world leader and prompting multiple international investigations into the individuals named so far.

While the coverage of the Panama leak has focused mainly on the international problem of anonymous companies, this is also a problem in the United States. One 2012 study found that the US is the second easiest place in the world to launder money, and in many states, you have to provide more information about your identity to get a driver’s license than you do to form a corporation.[1]

"Anonymous shell companies are the primary tool used to funnel illicit funds from criminal activities, including consumer credit card frauds, bogus government contracts that waste taxpayer dollars, and even hidden contributions to Super PACs," said Ana Owens, Tax & Budget Advocate with Maryland PIRG.

There is currently bipartisan legislation in congress to help law enforcement hold shell firms accountable. The Incorporation Transparency and Law Enforcement Assistance Act (HR4450, S2489) would require states to collect information about who owns or controls a company and make that information available to law enforcement upon request. Today and tomorrow, U.S. PIRG and the FACT coalition are bringing over 70 small business owners, faith leaders, and advocates to Washington, D.C. to urge Congress to act on the issue of anonymous companies.

“Senator Cardin and Senator Mikulski should support this legislation to provide law enforcement officials with the tools they need to track down abusers and protect the integrity of American business.” Owens said.  

[1]  Global Shell Games: Testing Money Launderers’ and Terrorist Financiers’ Access to Shell Companies

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