Congress must step up sanctions law to stop American adversaries

Analytics 16:18 30.05.2018
Though it may seem fanciful, there is a powerful tool that is tailor made for simultaneously combating North Korean nukes, Russian aggression, Chinese influence, and Iranian maleficence. This tool is beneficial ownership. In practice, existing beneficial ownership rules in the United States require compliance departments to collect, verify, and store data on clients, all at a cost to the consumer.
 
Proposed legislation preserves privacy, but requires businesses to submit and maintain basic information about ownership structures at the federal or state level, allowing better communication between the private sector and national security agencies. Almost all sanctions legislation has beneficial ownership language in it. Passing a general beneficial ownership law will give U.S. sanctions the teeth they need to truly deter the authoritarian scourge from entering our system.
 
Beneficial ownership is not an exact science, nor is it a panacea. Most proposals currently in Congress are simple and pragmatic approaches to increasing transparency while protecting privacy. The idea has been floated in the United States for years, Britain recently passed beneficial ownership legislation and extended it to its overseas territories, and Europe is in the process of implementing its version.
 
Beneficial ownership is the core recommendation of the Financial Action Task Force, a powerful intergovernmental body created by the G-7 in 1989 to combat money laundering and expanded in 2001 to combat terrorist financing. Beneficial ownership is the only pillar of the group on which the United States continues to fall short. However, there are four good reasons to take action: North Korea, China, Russia, and Iran.
 
North Korea is well integrated into the underbelly of the global economy. Its tentacles span the globe through operatives usually attached to embassies. As a result, Kim Jong Un laughs in the face of “maximum pressure” because his rogue regime has anonymously infected the supply chains of major multinational corporations and governments.
 
China directly supports North Korean efforts to sell missiles to Syria and Iran, and provides cover for Pyongyang’s illicit financing through secretly held Hong Kong companies. Of course, Beijing leverages anonymity to pursue its most unsavory behavior. The impunity of Chinese intellectual property theft thrives on the high levels of secrecy with which Chinese firms are allowed operate. Many, including myself, have a difficult time believing that the so-called “Chinese private sector” is anything but an arm of the Communist Party when push comes to shove.
 
Meanwhile, Russia’s sanctioned oligarchs are scrambling to reshuffle company ownership structures. The beneficial ownership language in the Countering America’s Adversaries Through Sanctions Act led several senators to request that banks scrutinize U.S. assets owned by Russians, such as Oleg Deripaska’s mansion in Washington.
 
Iran also benefits from the lack of transparency in ownership to elude sanctions. In fact, the last round of Iranian sanctions, before the “nuclear deal” was signed, resulted in the National Bank of Iran purchasing a Manhattan skyscraper rather than international isolation. Since then, Iran has continued to skirt U.S. sanctions through convoluted schemes. One recent case involved a Turkish-Iranian gold trader that may have allowed Iran to launder as much as $1 billion between 2012 and 2016.
 
Unfortunately, U.S. adversaries are not deterred by sanctions because sanctions are difficult to enforce and easier to evade. Having a better accounting of who owns what in the United States will only become more imperative as Britain and Europe squeeze sanctioned authoritarians out of their markets and further into the United States.
 
Treasury Department investigators are professional and knowledgeable civil servants, but the Justice Department simply cannot bring cases to trial because the ownership structures of assets belonging to bad actors are so complex that prosecutors have a difficult time connecting the dots for juries and judges who are not financial crime experts.
 
If nothing is done to address this impunity, markets infiltrated by these national security threats will not remain prosperous for long. North Korean counterfeiting, Chinese influence campaigns, Russian kleptocracy, and Iranian money laundering infect and degrade trust in our financial system, our businesses, and our democratic institutions. The risk of nuclear exchanges, trade wars, and terrorist attacks that illicit finance fuels disrupts productivity, reduces efficiency, and damages bottom lines.
 
Ultimately, a diverse range of national security threats are tied together by the effortlessness of creating obfuscated ownership structures designed to infiltrate prosperous markets. There are currently very few safeguards against this threat. Congress needs to work with the private sector to get a beneficial ownership strategy on the books sooner rather than later.
Hikmat Hajiyev: "Azerbaijan is a natural link connecting Central Asia and Europe" - VIDEO

News line

Hezbollah fires at Israel with Iranian-made missiles
Hezbollah fires at Israel with Iranian-made missiles
18:19 29.03.2024
Azerbaijan's Dushbara is on list of tastiest dumplings worldwide
18:00 29.03.2024
EU-Armenia-US joint conference may encourage Armenia to new provocations - Azerbaijan's FM
17:47 29.03.2024
Melting Polar Ice Caps Slow Earth's Rotation, Delaying "Leap Second" Addition
Melting Polar Ice Caps Slow Earth's Rotation, Delaying "Leap Second" Addition
17:29 29.03.2024
EU Delegation to Armenia Signals Push for Stability in South Caucasus - Insights from Arnold Stepanyan
17:14 29.03.2024
Russian MFA calls 102nd Military Base only guarantee of Armenia's sovereignty
17:01 29.03.2024
"The Ukrainian army is addicted to gambling" - says Ukrainian MP
"The Ukrainian army is addicted to gambling" - says Ukrainian MP
16:50 29.03.2024
Why are the US and the EU arming Armenia? - Pundit talks on Ednews
16:39 29.03.2024
Erdogan to visit US on May 9
Erdogan to visit US on May 9
16:26 29.03.2024
Hulusi Akar, US congressmen mull Azerbaijan-Armenia peace process
15:52 29.03.2024
Russian ambassador sees no reasons to expect Russian-US ties to improve
15:36 29.03.2024
British army lifts ban on serving soldiers having beards
British army lifts ban on serving soldiers having beards
15:29 29.03.2024
Hikmat Hajiyev: "Azerbaijan is a natural link connecting Central Asia and Europe" - VIDEO
15:13 29.03.2024
Azerbaijan weather forecast for March 30
Azerbaijan weather forecast for March 30
15:00 29.03.2024
Tajikistan detains 9 people over Russian concert shooting
Tajikistan detains 9 people over Russian concert shooting
14:46 29.03.2024
Washington Is Forming A New Alliance - OPINION
14:32 29.03.2024
Individuals identified as drug users will not be admitted for service in Azerbaijani tax authorities
14:14 29.03.2024
Philippines' Catholic devotees nailed to crosses to re-enact crucifixion
Philippines' Catholic devotees nailed to crosses to re-enact crucifixion
14:00 29.03.2024
Umud Mirzayev: EU's South Caucasus Visit Aims to Maintain Regional Influence
13:45 29.03.2024
Public Television of Armenia Reveals Villages to be Returned to Azerbaijan
13:39 29.03.2024
Death toll of Israeli strike in Syria rises to 42, war monitor says - UPDATED
13:25 29.03.2024
Azerbaijan toughens penalties for non-compliance with rules of state of emergency regime
Azerbaijan toughens penalties for non-compliance with rules of state of emergency regime
13:12 29.03.2024
How will the EU's visit to the South Caucasus affect the peace process? - Former ambassador talks to Ednews
13:00 29.03.2024
Azerbaijan tightens sanctions for breaching special operation zone rules on religious extremism
12:45 29.03.2024
Azerbaijan toughens penalties for non-compliance with rules of social emergency environment regime
12:33 29.03.2024
About $7 bln of foreign direct investment was invested in Azerbaijan last year
12:00 29.03.2024
Number of people injured in Crocus City Hall terrorist attack reaches 382
11:48 29.03.2024
Media: Netanyahu rejected the Mossad Chief's proposal for a possible agreement in Gaza
11:37 29.03.2024
Azerbaijani Parliament's meeting kicks off
11:26 29.03.2024
An American couple founded a website, which identifies brands that support Israel
An American couple founded a website, which identifies brands that support Israel
11:07 29.03.2024
US scientists name infection more dangerous for brain than coronavirus
US scientists name infection more dangerous for brain than coronavirus
11:00 29.03.2024
Parviz Shahbazov: Foundations of 4 new renewable energy plants will be laid this year
Parviz Shahbazov: Foundations of 4 new renewable energy plants will be laid this year
10:50 29.03.2024
Japan eyes self-driving expressway lane network
10:40 29.03.2024
Oil prices end 1Q24 with strong growth
10:30 29.03.2024
SECRETS of the European Union's visit to the South Caucasus - Fikret Sadigov EXPLAINS
10:25 29.03.2024
Ammunition found in Khankandi
Ammunition found in Khankandi
10:10 29.03.2024
Iran’s top diplomat: Military presence of third countries in Caspian Sea goes against interests of region
Iran’s top diplomat: Military presence of third countries in Caspian Sea goes against interests of region
10:00 29.03.2024
Armenia officially announces freezing its participation in CSTO
09:50 29.03.2024
US hopes to return to purchase of 72 fighter jets per year amid budget cuts
09:38 29.03.2024
Another 138 IDPs leave for Fuzuli
09:28 29.03.2024
Hamısı