The misuse of corporate vehicles, including trust and company service providers

Namens de Nederlandse delegatie meegewerkt aan het rapport “The misuse of corporate vehicles, including trust and company service providers” voor de Financial Action Task Force (FATF)

 

Corporate entities — corporations, trusts, foundations and partnerships — are often misused for money laundering, bribery and corruption, shielding assets from creditors, tax evasion, self-dealing, market fraud and other illicit activities. The veil of secrecy they provide in some jurisdictions may also facilitate the flow of funds to terrorist organisations. A new OECD publication, Behind the Corporate Veil: Using Corporate Entities for Illicit Purposes, urges governments to combat such misuse by acting to ensure the availability of information about ownership and control.

 
Behind the Corporate Veil concludes that the types of corporate entities that are most frequently misused are those that provide the greatest degree of anonymity to their beneficial owners. In response, the OECD calls on governments and other relevant authorities to ensure they are able to obtain information on the beneficial ownership and control of corporate entities and, where appropriate, to share this information with law enforcement authorities domestically and internationally.

 
Specifically, the OECD recommends that governments should consider taking action to:

 

  • Require up-front disclosure of beneficial ownership and control information to the authorities upon the formation of the corporate vehicle;
  • Oblige intermediaries involved in the formation and management of corporate vehicles (such as company formation agents, trust companies, lawyers, trustees, and other professionals) to maintain such information;

 

Develop the appropriate law enforcement infrastructure to enable them to launch investigations into beneficial ownership and control when illicit activity is suspected.

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