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Joint Trades Letter of Support for AML-CFT Reform Bill
Dear Representatives Pearce and Luetkemeyer,
We are pleased to write in support of the draft Counter Terrorism and Illicit Finance Act, cosponsored by Chairmen Pearce and Luetkemeyer. We believe the bill will modernize our nation’s anti-money laundering and countering the financing of terrorism (AML/CFT) regime and help prevent the use of shell companies to launder money by cloaking the identities of their beneficial owners from law enforcement.
The bill targets anonymously owned shell companies by establishing a beneficial ownership reporting requirement on closely held, non-public legal entities. Importantly, the bill would also provide financial institutions with access to reported information to assist them with their customer due diligence compliance efforts. Small businesses will soon be required to provide such information to their banks and other financial institutions under FinCEN’s customer due diligence (CDD) rule. The draft bill appropriately coordinates the definition of beneficial ownership with FinCEN’s rule. It is our hope that this will help reduce the anticipated burden of complying with the requirements of the CDD rule. Financial institutions should be able to rely on the information reported by businesses to FinCEN, which would, in turn, reduce the reporting burden on those businesses.