Treasury Urged to Scrutinize Foreign Real Estate Buyers for Money-Laundering Risk

...

a 2010 report by the United States Senate Permanent Subcommittee on Investigations which showed how corrupt foreign officials and their associates had undermined anti-money-laundering controls, using ill-gotten money to purchase real estate in the United States.

The real estate industry has said it adheres to its own voluntary guidelines in performing background checks on purchasers. In the series, which focused on condominium purchases overlooking Central Park at the Time Warner Center, The Times quoted several people involved in luxury real estate transactions who acknowledged performing few background checks on buyers beyond determining their financial wherewithal to purchase luxury condos worth tens of millions of dollars.

More than half the time, the condos are purchased under the names of limited liability companies that mask the identities of the true owners. Current law in a number of states, as well as offshore jurisdictions, does not require disclosure of the identities of the beneficial owners of these entities.