House Anti-Money Laundering Resolution Highlights Financial System Loopholes

The United States House of Representatives approved a resolution (H.Res. 206) highlighting several known weaknesses in the global financial sector that may be exploited by criminals and terrorist groups.

In particular, the resolution referenced (i) the lack of transparency in the arts and antiquities industry and the recent surge in U.S. markets of Middle Eastern artifacts believed to have been plundered by terrorist organizations such as the Islamic State of Iraq and the Levant (ISIL); (ii) the high number of luxury residential real estate purchasers in U.S. markets whose identities were uncovered as the result of recent FinCEN geographic targeting orders ("GTOs"); and (iii) Russian oligarchs as among the groups believed to have been utilizing these areas for the purpose of injecting the proceeds of criminal activity into global financial institutions through shell companies.

By the resolution's operative language, the House of Representatives:

• acknowledges that "the lack of sunlight and transparency in financial transactions" presents a threat to national security and the U.S. economy's security;
• supports efforts to shut loopholes that permit corruption, terrorism and money laundering;
• fosters transparency to "detect, deter, and interdict individuals, entities, and networks" engaged in money laundering and other related crimes;
• calls on financial institutions to adhere to the Bank Secrecy Act and other anti-money laundering laws; and
• affirms that financial institutions and individuals must be held to account for committing money laundering.