By: Christin M. Roberts
In an effort to curtail corruption, President Biden’s new memorandum requires U.S. Companies to disclose their beneficial ownership to the Department of the Treasury.
One hundred and forty-one days after President Biden took office, he now calls upon 15 different agencies and offices within the government to each play a part in his administration’s assault on corruption. In his “whole of government” approach, President Biden tasks the 15 agencies and offices – which ranges from the Department of Defense, to the Office of Management and Budget to the Office of the Chairman of the Joint Chiefs of Staff – to actively participate in an interagency review to counter corruption in the U.S. and abroad.
On June 3, 2021, President Biden signed his 173rd Presidential Action, titled Memorandum of Establishing the Fight Against Corruption as a Core United States National Security Interest. After a long and contentious campaign trail, this memorandum serves as an initiation for his administration to:
- Promote good governance
- Bring transparency to the U.S. and global financial systems
- Prevent and combat corruption at home and abroad
- Make it increasingly difficult for corrupt actors to shield their activities
According to the “Fact Sheet” released in conjunction with the Memorandum, on December 20, 2021, 200 days after President Biden signed the Memorandum, the interagency review will culminate in a report and provide recommendations on how the U.S. Government and its partners can:
- Modernize, Coordinate, and Resource Efforts to Better Fight Corruption
- Curb Illicit Finance
- Hold Corrupt Actors Accountable
- Build International Partnerships
- Improve Foreign Assistance
The true implications of this memorandum will not be known for another 192 days, but for now we know the focus on “curbing illicit finance” has a newfound federal focus: robust federal law will now require U.S. companies to report their beneficial owner or owners to the Department of the Treasury. This requirement is geared toward eliminating shell corporations and disrupting tax havens by reducing offshore financial secrecy and improving information sharing.
These proactive measures mark a bold new take on weeding out corruption; the interagency review report will determine whether new Federal legislation is necessary to implement more reforms targeted at combating illicit finance in the U.S. and international financial system. See full Memorandum on Establishing the Fight Against Corruption as a Core United States National Security Interest