Improving Laundering Laws and Increasing Comprehensive Information Tracking of Criminal Activity in Shell Holdings Act
A BILL
To improve laws relating to money laundering, and for other purposes.
2. Findings and purposes
Findings— Congress finds the following:
The practice known as bank de-risking, whereby financial institutions avoid rather than manage anti-money-laundering and countering-the-financing-of-terrorism sanctions compliance risk, has negatively impacted the ability of nonprofit organizations to conduct lifesaving activities around the globe.
Two-thirds of nonprofit organizations based in the United States with international activities face difficulties with financial access, most commonly the inability to send funds internationally through transparent, regulated financial channels.
Without access to timely and predictable banking services, nonprofit organizations cannot carry out essential humanitarian activities that literally can mean life or death to affected communities.
De-risking ultimately drives money into less transparent channels through carrying of cash or use of unlicensed or unregistered money service remitters, thus reducing transparency and traceability, which are critical for financial integrity, and increases the risk of money falling into the wrong hands.
Federal agencies must work to address de-risking through establishment of guidance enabling financial institutions to bank nonprofit organizations and promoting focused and proportionate measures consistent with a risk-based approach.
The Federal Government should work cooperatively with other donor states to promote a multi-stakeholder approach to risk-sharing among governments, financial institutions, and nonprofit organizations.
Purposes— The purposes of this Act are—
to improve coordination among the agencies tasked with administering anti-money-laundering and countering-the-financing-of-terrorism requirements, the agencies that examine financial institutions for compliance with those requirements, Federal law enforcement agencies, the intelligence community, and financial institutions;
to establish beneficial ownership reporting requirements to improve transparency concerning corporate structures and insight into the flow of illicit funds through such structures, discourage the use of shell corporations as a tool to disguise illicit funds, assist law enforcement with the pursuit of serious crimes, and protect the national security of the United States;
to modernize anti-money-laundering and counter-financing-of-terrorism laws to adapt the government and private sector response to new threats;
to encourage technological innovation and the adoption of new technology by financial institutions to more effectively counter money laundering and terrorist financing; and
to reinforce that the anti-money-laundering and countering-the-financing-of-terrorism policies, procedures, and controls of financial institutions shall be risk-based.
3. Definitions
In this Act:
Bank Secrecy Act— The term Bank Secrecy Act means—
section 21 of the Federal Deposit Insurance Act (12 U.S.C. 1829b);
chapter 2 of title I of Public Law 91–508 (12 U.S.C. 1951 et seq.); and
subchapter II of chapter 53 of title 31, United States Code.
Federal functional regulator— The term Federal functional regulator has the meaning given the term in section 509 of the Gramm-Leach-Bliley Act (15 U.S.C. 6809).
FinCEN— The term FinCEN means the Financial Crimes Enforcement Network of the Department of the Treasury.
Financial institution— The term financial institution has the meaning given the term in section 5312 of title 31, United States Code.
Secretary— The term Secretary means Secretary of the Treasury.
State bank supervisor— The term State bank supervisor has the meaning given the term in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813).
4. Sense of Congress
It is the sense of Congress that providing vital humanitarian and development assistance and protecting the integrity of the international financial system are complementary goals. As such, Congress supports the following:
Effective measures to stop the flow of illicit funds and that promote the goals of anti-money laundering and countering the financing of terrorism and sanctions regimes.
Anti-money laundering and countering the financing of terrorism and sanctions policies that do not hinder or delay the efforts of legitimate humanitarian organizations in providing assistance to—
meet the needs of civilians facing humanitarian crisis, including access to food, health and medical care, shelter, and clean drinking water; and
prevent or alleviate human suffering, in keeping with requirements of international humanitarian law.
Policies that ensure that incidental, inadvertent benefits that may indirectly benefit a designated group in the course of delivering life-saving aid to civilian populations, are not the focus of the Federal Government enforcement efforts.
All laws, regulations, policies, guidance and other measures that ensure the integrity of the financial system through a risk-based approach.