But when it became clear that the States would not step up to the plate, we then introduced the bill.

This legislation, which is the result of work done by Senator Levin's Permanent Subcommittee on Investigations (PSI), seeks to increase the transparency of business formation practices as a way to reduce what is estimated as billions of…

Because there has been some confusion about that. The living, breathing person that we are looking for is the beneficial owner, the person that controls.

the Department strongly supports any Federal legislation that would bring transparency to this area.

The beneficial owner standard in FATF has been there for 20 years, by the way.

Instead of collecting beneficial ownership information at the time that a new corporation is being formed in the United States, as our bill does, the NCCUSL proposal would allow hidden persons to obtain a U.S. corporation, misuse it, and…

The bill does not change State law. It adopts a Federal requirement that the States ask the question on the incorporation form about beneficial ownership.

We are trying to protect the rights of the States here.

Thank you, Mr. Chairman, for your holding again this hearing.

It should be kept in the United States where it is easily accessible.

We are not looking for some shell corporation to be called the owner.

If false information is provided on the form, would it be fair to say that even that information might be helpful?

It is imperative that not be the case here.

My time is up, but I would just say that we ask banks all the time for who the beneficial owners of accounts are, and they provide that information to us.

The potential for criminals to buy these types of companies without ever divulging their names or interest is a threat to our security and to our well being.

I think that is an important point. I think that is a common approach, as a matter of fact.

Informing suspects of active U.S. law enforcement investigations is not a good way to thwart or punish crime.

That is not even a close question. It should be in the United States.

I look forward to the definition on beneficial owners.

So like the company that Senator Carper mentioned that is listed on the stock exchange with a securities commission, they would be exempted from this bill.

the law enforcement community, very much supports this bill and wants to avoid an unfunded mandate

Their approach to the definition of beneficial ownership is not one of them.

The very requirement of having someone state beneficial ownership is important because it brings an aspect of daylight onto the activities of these criminal corporate entities.

Our bill, the Levin-Grassley-McCaskill bill, that is the subject of today's hearing, would assist our law enforcement community instead of thwarting it.

We prohibit it. We say only if a State decides that they want to make it available for whatever reason.