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Putting an End to Shell Companies in the US

The House of Representatives is considering legislation this week that could permanently end the existence of shell companies in the United States. Shell companies have little to no operations, but still may hold assets. These companies can be used to avoid know-your-customer (KYC) and anti-money laundering (AML) regulations and compliance. Shell companies allow individuals to hide behind anonymity and reduced liability.

Similar legislation in Latvia lead to the shutdown of over 17,600 shell companies.

Shell companies make KYC compliance and legislation complicated because of the anonymity they provide. The Corporate Transparency Act that is currently pending in Congress would require certain companies to identify beneficial owners of the corporation.

Read more in this article.

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