A bipartisan group of lawmakers is set to introduce new legislation aimed at stopping enablers of international corruption in response to the findings highlighted in the Pandora Papers investigation.
The Establishing New Authorities for Business Laundering and Enabling Risks to Security (ENABLERS) Act would make it harder for “kleptocrats” across the globe to launder money in the United States, according to Reps. Tom Malinowski (D-N.J.), Maria Elvira Salazar (R-Fla.), Steve Cohen (D-Tenn.), and Joe Wilson (R-S.C.).
The bill (pdf) would amend the 51-year-old Bank Secrecy Act by enabling the Treasury Department to impose stronger due diligence requirements on the source of funds for investment advisers, art dealers, attorneys involved in financial activity, company service providers, accountants, PR firms, and third-party payment providers.
Such a due diligence requirement could be something as simple as asking if suspicious funds are the proceeds from a crime.
It would also remove an exemption that has been in place since 2002 that means real-estate professionals, sellers of luxury cars, ships, and aircraft do not have to have anti-money laundering programs in place.
In a joint statement issued on Oct. 6, lawmakers said the act would “ensure that the United States never again facilitates the corruption and dictatorship we claim to oppose by giving kleptocrats and criminals a safe haven for the money they steal from their people.”
“In turn, it would protect Americans from inflated real estate prices, job loss, human trafficking, and influence peddling” they added.
The bill will likely be introduced on Friday and, if passed, the Treasury Department would have until Dec. 31, 2023 to ensure it has imposed stronger due diligence requirements. All enablers subject to the amendment must also have programs in place by June 30, 2024, regardless of whether or not Treasury has publicly declared the rule.
However, it is likely to face opposition from the multiple industries it affects.
In Thursday’s statement, Lawmakers pointed to the recent Pandora Papers, which highlighted how world leaders, powerful politicians, billionaires, and others have used offshore accounts to shield assets collectively worth trillions of dollars over the past quarter-century.
