President Biden’s administration is wanting to expand the current reporting requirements on any real estate deals that are paid for with all-cash to help crack down on any illegal use of the United States market to launder cash made through illegal activity.
The Treasury Department was releasing a notice Monday seeking comment from the public for a possible regulation that would fix what it claims is a vulnerability within the real estate market.
Currently, title insurance businesses in just 12 metropolitan locations are required to file a report identifying individuals who purchase residential real estate with all-cash purchases through shell companies if the price exceeds $300,000.
“More transparency within the real estate market will curb the ability of criminals and corrupt officials to launder money through the United States’ real estate market,” stated Himamauli Das.
Das stated the move might “strengthen U.S. national security and help defend the integrity of the U.S. financial system.”
The metropolitan areas that are currently facing these reporting requirements are Boston, Chicago, Dallas-Fort Worth, Honolulu, Las Vegas, Los Angeles, Miami, New York City, San Antonio, San Diego, San Francisco, and Seattle.
The real estate market in the United States has long been seen as a stable way for corrupt government officials around the world and other illicit actors wanting to launder the proceeds from criminal activities.
The use of shell businesses by former and current world leaders, and those that are close to them, to buy real estate and other assets in the United States and abroad was recently brought to the public’s attention by the release of the “Pandora Papers.”
The documents that were acquired and leaked by the consortium revealed that King Abdullah II of Jordan, former U.K. prime minister Tony Blair and other top figures had all used shell businesses to buy mansions, yachts, exclusive beachfront property and other assets for the past twenty-five years.
It’s possible for tax dodges to be legal but have given rise to different proposals to raise tax transparency and reinforce efforts in the fight against tax evasion.
The effort to push for new regulations within the real estate market comes as Pres. Biden’s administration on Monday released its “U.S. Strategy on Countering Corruption.”
The strategy was released as Pres. Joe Biden prepares to host the first WH Democracy Summit, a virtual meeting of civil society experts and leaders from more than 100 nations that is set to take place at the end of the week.
The strategy offers ways for confronting corruption in the U.S. and abroad. It includes calls for the United States government to shore up regulatory gaps, increasing anti-corruption efforts in the U.S. and reinforcing the protection of civil society and members of the news, including investigative journalists, who work to expose corruption.
Author: Scott Dowdy
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