MBA Career: Unveiling a Business Database with 100,000 Firms, as Disclosed by Yellen – The Associated Press

Last Updated on January 9, 2024 by Robert C. Hoopes

Title: Treasury Secretary Janet Yellen Launches Database to Fight Money Laundering

Treasury Secretary Janet Yellen has announced a significant step in the fight against illicit financial activity, as she unveils a new database collecting “beneficial ownership” information. With over 100,000 businesses joining the initiative, the database aims to unmask the true owners behind shell companies and prevent their misuse, signaling that the United States is no longer a safe haven for dirty money.

In Vienna, VA, Yellen paid a visit to the Treasury’s Financial Crimes Enforcement Network (FinCEN) to discuss the database launch and upcoming real estate rules. This visit serves as a strong display of the Biden administration’s commitment to enhancing corporate transparency, an area where the lack of proper oversight allows illicit activities to thrive within opaque corporate structures.

By providing law enforcement agencies with access to beneficial ownership information, the new database can significantly aid in the apprehension, prosecution, and forfeiture of assets acquired through illegal means. This crucial information can be instrumental in dismantling complex criminal networks and recovering ill-gotten gains.

The authority to establish rules on beneficial ownership was granted to the Treasury by the bipartisan Corporate Transparency Act, signed into law earlier this year. Effective January 1, 2023, the act mandates that most US firms, including approximately 32.6 million businesses with fewer than 20 employees, disclose identifying information about their owners or controllers. This move is designed to eliminate the use of shell companies as a shield for illegal activities.

However, the announcement of the database has faced opposition, with the National Small Business Association filing a lawsuit against the Treasury, arguing that it violates the US Constitution. The decision on this legal challenge will be made by a judge in the near future.

During her visit, Secretary Yellen emphasized that the Treasury is contemplating further measures to mitigate risks associated with commercial real estate, which has become a common vehicle for money laundering. A staggering $2.3 billion has been laundered through US real estate between 2015 and 2020 alone, highlighting the urgent need to address this issue.

The benefits of increasing corporate transparency are far-reaching. In addition to protecting national security and the financial system, enhanced transparency reduces due diligence costs, fosters fair business competition, and boosts tax revenues for the government.

FinCEN, the agency responsible for operating the new database, plays a crucial role in safeguarding the financial system from criminal abuse, money laundering, and other illicit activities. The establishment of this initiative is a significant step towards promoting corporate accountability and deterring money laundering within the United States.

Through this concerted effort, Secretary Yellen aims to send a resounding message that the United States is committed to upholding financial integrity and ensuring that its markets remain free from illicit activities.