US treasury secretary announces international commitment to enhance beneficial ownership transparency

US treasury secretary, Janet Yellen, said on Tuesday that she was launching a commitment by Washington and more than twenty foreign governments and authorities to enhance beneficial ownership transparency.

Speaking at the Biden-Harris Administration’s second Summit for Democracy, she said the participants in the project would initially be drawn from countries represented at the summit.

The commitment, she said, is in line with the revised Financial Action Task Force (FATF) standard on beneficial ownership, which requires countries to improve the transparency of legal persons, like shell companies, and to prevent their misuse.

Global architecture

Outlining Washington’s international efforts to enhance beneficial ownership transparency, Yellen said the US intends strengthening the global anti-corruption architecture.

“Without a strong and unified global approach, corrupt actors will continue to exploit financial loopholes and lightly regulated jurisdictions,” she told the summit.

International expectations

Participating countries would be expected to create and maintain legal and regulatory frameworks to ensure cross-border information exchanges on beneficial ownership between law enforcement agencies and other authorities.

The initiative will be in line with the FATF’s guidance paper updated earlier this year outlining tougher global beneficial ownership rules aimed at preventing criminals from hiding their illicit activities and money behind secret corporate structures (Trade-based Financial Crime, 15 March 2023).

Participating countries

Yellen did not name the more than twenty countries at the summit that would be participating in this initiative.

Speakers at the summit included Ukraine’s President Volodymyr Zelenskyy as well as the presidents or prime ministers of Sweden, UK, Bahamas, Germany, Kosovo, Colombia, France, Iceland, Slovakia, Malawi, Ecuador, Moldova, Niger, Denmark and Panama.

The treasury secretary said she would “look forward to more partners joining this important commitment following this summit.”

US treasury secretary Janet Yellen’s full address to the second Summit for Democracy can be found here.

The FATF’s Guidance to Beneficial Ownership of Legal Persons (Recommendation 24) can be downloaded from here.


Categories: Trade Based Financial crimes News

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