Obama Urged to Back Public Disclosure of Shell Corporations

President Barack Obama is being urged to back a plan that would force owners of shell companies to publicly register in the United States and around the world in an effort to fight corruption, tax evasion, and money laundering, according to The New York Times.

Letters were sent to Obama last week by two groups of prosecutors and anti-corruption activists detailing the plan, which also is supported by British Prime Minister David Cameron. Backers plan to bring the shell-company disclosure plan up at the Group of 8 economic summit later this month in Northern Ireland, the Times reported.

"Corrupt politicians, tax evaders, and organized criminals all use complex webs of shell companies to hide and launder stolen money," said one of the letters, signed by 19 prosecutors and activists.

The group wants "governments to require existing company registers to collect information on the ultimate owners of all companies" and to make that information available to the public, the Times noted.

"These anonymous shell companies are used by everybody who steals money," Jack A. Blum, attorney and chairman of Tax Justice Network USA, told the Times.

Blum said thousands of shell corporations have been established in the United States, primarily in Delaware, Montana, Nevada, and Wyoming, which, he suggested, have loose regulations.

According to the Financial Crimes Enforcement Network, a bureau of the Treasury Department, shell companies accounted for as much as $18 billion in suspicious transactions via international wire transfer in 2005.

Michigan Sen. Carl Levin has been trying to pass legislation since 2000 requiring states to collect information on shell corporations in their states. His measure, which the Times noted was co-authored by Obama when he was senator, has failed three times.