Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

US proposes crackdown on financial ‘enablers’ in wake of Pandora papers

US proposes crackdown on financial ‘enablers’ in wake of Pandora papers

Legislation would force trust companies, lawyers and middlemen to investigate wealthy clients seeking to move money into US system
US lawmakers are proposing legislation that would force trust companies, lawyers and other financial middlemen to investigate foreign clients seeking to move money and assets into the American financial system.

The bipartisan bill was proposed in the wake of the Pandora papers, a leak of 11.9m files from 14 different offshore services providers around the world that revealed how the global elite use tax havens to legally avoid paying billions in taxes, and how they are increasingly taking advantage of the US’s liberal trust laws.

The Pandora papers show how a handful of US states, led by South Dakota, are now providing growing competition for more traditional tax havens such as the Bahamas, the Cayman Islands and Switzerland.

An analysis of the leak by the International Consortium of Investigative Journalists (ICIJ) and the Washington Post showed that nearly 30 trusts had been established in South Dakota holding assets connected to people or companies accused of corruption, human rights abuses or other wrongdoing.

Following a series of deregulations, South Dakota’s trusts enjoy some of the world’s most powerful legal protections from taxes, creditors and other claimants in the world, and hold $367bn (£273bn) in assets, up from $75.5bn (£55.36bn) in 2011.

The proposed legislation, the Establishing New Authorities for Business Laundering and Enabling Risks to Security (Enablers) Act, would require the treasury department to create new due-diligence rules for American middlemen who facilitate the flow of foreign assets into the United States.

The act would update the 51-year-old Bank Secrecy Act, which requires banks to investigate their clients and the source of their wealth but had excluded trust companies, accountants, lawyers and other professionals.

In an unusual sign of bipartisanship, the legislation is backed by Democratic congressmen Tom Malinowski of New Jersey and Steve Cohen of Tennessee, as well as Republican members of Congress Maria Elvira Salazar of Florida and Joe Wilson of South Carolina.

“If we make banks report dirty money but allow law, real estate, and accounting firms to look the other way, that creates a loophole that crooks and kleptocrats can sail a yacht through,” Malinowski said in a statement. “Our bill closes that loophole and encourages the administration to move in the same direction.”

“American adversaries ranging from China to Iran to Russia have taken advantage of the US enablers of kleptocracy – unscrupulous lawyers, accountants, and others, to push their dirty money into our system, attempting to undermine our republic from within,” said Wilson.

“If we are serious about fighting dictatorship, we need US professionals to do the most basic due diligence,” he said.

The US move is the latest in a series of crackdowns in the wake of the Pandora papers revelations. Authorities in at least eight countries have announced investigations following the publication of the stories.

On Friday, members of the European parliament voted to tighten rules that allow the super-rich to move their wealth off shore.
AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Emails Leaked: How Passenger Luggage Became a Side Income for Airport Workers
Polish MEP: “Dear Leftists - China is laughing at you, Russia is laughing, India is laughing”
Western Europe Records Hottest June on Record
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
China’s Central Bank Consults European Peers on Low-Rate Strategies
France Requests Airlines to Cut Flights at Paris Airports Amid Planned Air Traffic Controller Strike
Poland Implements Border Checks Amid Growing Migration Tensions
Emirates Airline Expands Market Share with New $20 Million Campaign
Amazon Reaches Milestone with Deployment of One Millionth Robot
Yulia Putintseva Calls for Spectator Ejection at Wimbledon Over Safety Concerns
House Oversight Committee Subpoenas Former Jill Biden Aide Amid Investigation into Alleged Concealment of President Biden's Cognitive Health
Amazon Reaches Major Automation Milestone with Over One Million Robots
Extreme Heat Wave Sweeps Across Europe, Hitting Record Temperatures
Meta Announces Formation of Ambitious AI Unit, Meta Superintelligence Labs
Robots Compete in Football Tournament in China Amid Injuries
China Unveils Miniature Insect-Like Surveillance Drone
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Germany Votes to Suspend Family Reunification for Asylum Seekers
Budapest Pride Parade Draws 200,000 Participants Amid Government Ban
Southern Europe Experiences Extreme Heat
Xiaomi's YU7 SUV Launch Garners Record Pre-Orders Amid Market Challenges
Jeff Bezos and Lauren Sanchez's Lavish Wedding in Venice
Russia Launches Largest Air Assault on Ukraine Since Invasion
Massive Anti-Government Protests Erupt in Belgrade
Iran Executes Alleged Israeli Spies and Arrests Hundreds Amid Post-War Crackdown
Hungary's Prime Minister Criticizes NATO's Role in Ukraine
EU TO HUNGARY: LET THEM PRIDE OR PREP FOR SHADE. ORBÁN TO EU: STAY IN YOUR LANE AND FIX YOUR OWN MESS.
Hungarian Scientist to Conduct 30 Research Experiments on the International Space Station
NATO Members Agree to 5% Defense Spending Target by 2035
NATO Leaders Endorse Plan for Increased Defence Spending
U.S. Crude Oil Prices Drop Below $65 Amid Market Volatility
International Astronaut Team Launched to Space Station
Macron and Merz: Europe must arm itself in an unstable world
Germany and Italy Under Pressure to Repatriate $245bn of Gold from US Vaults
Iran Intensifies Crackdown on Alleged Mossad Operatives After Sabotage Claims
Trump Praises Iran’s ‘Very Weak’ Response After U.S. Strikes and Presses Israel to Pursue Peace
Oil Prices Set to Surge After US Strikes Iran
BA and Singapore Airlines Cancel Dubai Flights Amid Middle East Tensions
Trump Faces Backlash from MAGA Base Over Iran Strikes
Meta Bets $14 B on Alexandr Wang to Drive AI Ambitions
FedEx Founder Fred Smith, ‘Heart and Soul’ of the Company, Dies at 80
Chinese Factories Shift Away from U.S. Amid Trump‑Era Tariffs
Pimco Seizes Opportunity in Japan’s Dislocated Bond Market
Labubu Doll Drives Pop Mart to Status as China’s Most Valuable Toy Maker
Global Coal Demand Defies Paris Accord Goals
United States Conducts Precision Strikes on Iran’s Nuclear Sites
US strikes Iran nuclear sites, Trump says
Telegram Founder: I Will Leave My Fortune to Over 100 of My Children
16 Billion Login Credentials Leaked in Unprecedented Cybersecurity Breach
×