StAR Workshop at IACC 2022
Signatures for Sale: A Look Inside the Corporate Secrecy Industry
Palladium F4T, Omni Shoreham Hotel, Washington DC - 9:30 - 11:00AM
“Would you like to be anonymous where your ex-spouse, boss, renters, mooching friends and family, and the government doesn’t know your business? Our nominee service keeps your name and contact information off public records by listing a nominee name and contact information instead of yours.” Offer by U.S. corporate service provider to researchers, 2020.
Despite major improvements in beneficial ownership rules in the past years, anonymous shell companies remain one of the most common means of facilitating corruption, financial crime and global flows of dirty money. Such companies are often created and administered by professional corporate service providers who openly advertise a slew of secrecy services to international clients shopping for anonymous corporate structures. Nominee and mail-forwarding services are often a key part of the subterfuge whereby a corporate puppet obscures the identity of the puppet master.
Rather than being peripheral to the broader beneficial ownership transparency agenda, these secrecy mechanisms represent a major – but largely underappreciated – point of vulnerability in the ongoing global campaign to curb the use of untraceable shell companies in financial crime. While international standards on beneficial ownership transparency by the Financial Action Task Force have been in place since 2012, and were revised in 2022, illicit corporate networks commonly split company formation, asset ownership, bank account, and professional intermediaries across different countries to exploit loopholes in national regulation - this makes it difficult for authorities in any single country to see the full picture. Marketing materials openly selling nominee and other secrecy services as a “signature for sale” are a stark reminder that beneficial ownership rules do not enforce themselves. At national levels, in many countries AML regulation of professional intermediaries is weakly enforced or does not exist at all. Company registries and beneficial ownership registries, where they exist, often only have rudimentary verification mechanisms in place to detect and sanction reporting false information, if any.
The workshop will explore these issues within the broader context of the global agenda to increase corporate transparency and improve effectiveness of beneficial ownership registries to curb financial crime. The StAR Initiative, Finance Uncovered, and TI Canada aim to promote a wide debate about how to stop the abuse of untraceable shell companies in financial crime, improve regulation of enablers, and safeguard the financial system and professions against becoming safe havens for corrupt funds.
International Anti-Corruption Conference (IACC) 2022
The International Anti-Corruption Conference (IACC) is the world’s premier global forum for bringing together heads of state, civil society, the private sector and more to tackle the increasingly sophisticated challenges posed by corruption. Established in 1983, the IACC takes place usually every two years in a different region of the world, and hosts from 800 to 2000 participants from over 140 countries worldwide.
The IACC advances the anti-corruption agenda by raising awareness and stimulating debate. It fosters networking, cross-fertilisation and the global exchange of experience that are indispensable for effective advocacy and action, on a global and national level. The conferences also promote international cooperation among government, civil society, the private sector, and citizens by providing the opportunity for face-to-face dialogue and direct liaison between representatives from the agencies and organisations taking part.