Group: Address opioid crisis by ending anonymous shell companies

Lawmakers should end the use of anonymous shell companies to make it easier for law enforcement to curb the drug trafficking behind the opioid crisis, a report released Monday argues.

“Simply requiring that all companies formed in the U.S. disclose their beneficial owners would enable law enforcement to more effectively follow the money trail and make it harder for criminals to hide their money,” the Fair Share Education Fund, a group that “promotes economic fairness and sustainability,” said in its report.

“We should use every tool at our disposal to tackle the opioid crisis, and going after the money is just such a critical tool,” the group added.

Opioid overdose deaths have quadrupled in the past 15 years, and the White House and others consider the opioid crisis to be one of the worst public health epidemics in the history of the United States. Many opioid addicts start by using prescription pain killers and then move on to heroin because it is cheaper, according to the report.

The Office of National Drug Control Policy estimates that federal authorities only seize 1.5 percent of the money Americans spend annually on illegal drugs. One of the reasons why law enforcement has difficulty making cases against drug traffickers is that criminals are easily able to launder their money through anonymous shell companies, the report stated.

No state requires people forming companies to disclose the identities of the people who actually own or control them. The U.S. is one of the easiest countries for criminals to establish anonymous shell companies.

“Authorities may have good reason to suspect someone of being involved in criminal activity,” Fair Share Education Fund said. “However, without the basic information necessary to show that a suspect is directly linked to a shell company used to facilitate illegal activity, they are unable to make their case, or run out of the time and resources needed to do so. “

The report looks at 10 cases where anonymous shell companies have been linked to opioid trafficking. In some of the cases, drug proceeds were spent on luxury items such as racehorses and diamond-encrusted watches.

Gary Kalman, executive director of the Financial Accountability & Corporate Transparency Coalition, echoed the need for lawmakers to pass bills to require the true owners of shell companies to be disclosed.

“Congress should immediately pass bipartisan legislation to end the secrecy and give cops and prosecutors the tools they need to go after drug cartels and others who threaten the safety and security of our communities,” said Kalman, whose coalition counts the Fair Share Education Fund as a member.

One of the sponsors of such legislation, Sen. Chuck Grassley (R-Iowa), said in a news release that the bill is “yet another way to attack crises like the opioid epidemic that is taking root in communities across our country.” 

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