As a Special Agent with IRS Criminal Investigation for over two decades, I investigated complex financial crimes across borders, primarily money laundering and tax evasion. The work included navigating the use of shell and shelf companies to conceal true ownership and unraveling complex layers of transactions, often facilitated by professional enablers. These facilitators of financial crimes present threats to financial systems because they excel at concealing and obfuscating fiduciary ownership. Today, the beneficial ownership landscape in the United States looks very different than it did two years ago. A national registry of company ownership was built, and then the policy shifted to relieve domestic companies of the reporting burden.
A Few Hundred Dollars and a Mailing Address
For years, a significant vulnerability in the U.S. financial system was the ease with which criminals could hide behind anonymous companies. A few hundred dollars, a quick online filing, and you could create an LLC in a state that asked for little more than a name and a mailing address. Beneficial owners could be buried under layers of companies, nominee directors, or offshore trustees.
These structures became the foundation of domestic and international money laundering. Some examples include:
- Shell companies created to move illicit proceeds disguised as consulting fees
- Real estate purchased by LLCs then flipped at inflated values to launder proceeds.
- Small businesses set up with straw owners to receive PPP fraud proceeds or tax refunds.
- Luxury vehicles and art purchased by entities whose true fiduciary ownership intentionally omitted or disguised.
The United States had strong AML laws but lacked visibility into ownership structures. The response to it has evolved over the past several years, and the current approach places more responsibility on financial institutions and investigators than a government registry.
A Tool in the Investigator’s Toolkit
The Corporate Transparency Act was enacted in 2021 and took effect in January 2024. For the first time, millions of U.S. companies were required to report their beneficial owners to FinCEN, creating a national registry of who truly controlled U.S. legal entities. A corporate registry search that once hit a dead end could be replaced by a single query, available to law enforcement under strict protocols, that cut through layers that could have taken significant time to unravel.
The policy has since changed. In March 2025, FinCEN issued an interim rule exempting U.S. companies and U.S. persons from reporting, citing the compliance burden on businesses. On August 11, 2026, FinCEN finalized that rule. Domestic companies are no longer required to report, and FinCEN announced it will remove the information U.S. persons had already submitted. Foreign entities registered to do business in the United States continue to report their foreign beneficial owners.
Other jurisdictions have taken a different path. During my five years at the American Embassy in London, I worked alongside investigators who could start with the United Kingdom’s public register at Companies House. I relied on Companies House regularly to advance investigations, and the data it provided proved highly valuable. To be clear, registries are not the “be-all and end-all” to solve beneficial ownership issues investigators often face. While they are a tool in the investigator’s toolkit, investigators often come across false corporate documents in registries. Penalties vary by jurisdiction if individuals fail to report properly or intentionally provide false information.
The absence of a registry won’t stop investigators. However, it does change things. For example, every layer a criminal adds takes time to unwind and time is critical in investigations. The tools that built beneficial ownership cases before 2024 still exist and they still work. Investigators will continue to rely on:
- Bank records via grand jury subpoenas and summonses.
- State filings and federal tax records.
- FinCEN 314(a) requests and Bank Secrecy Act data.
- International cooperation between financial intelligence units, mutual legal assistance treaties, and attachés deployed overseas.
- Public Private Partnerships
- Understandably, MLATs are critical for prosecuting white collar cases with a global nexus; however, time becomes a major factor impacting prosecutions and especially asset recovery.
Time Not on Our Side
Depending on the complexities involved, laundering money can take weeks, days, or minutes and investigators are always on the lookout for the following:
- Multiple domestic accounts across different states
- Foreign correspondent banking
- Cross-border wires split into sub-transactions
- Crypto exchanges and mixing services
- Mobile payment applications (opening / closing accounts regularly and purchasing vetted accounts that underwent proper due diligence)
- Structured ATM withdrawals
- Real-asset purchases through shell entities
The U.S. has powerful tools, including subpoenas, SARs, bank cooperation, and attachés deployed overseas. But tracing increasingly relies on multidisciplinary teams, including agents, analysts, prosecutors, cyber specialists, and data scientists.
Virtual Assets and Beneficial Ownership
Cryptocurrencies are not inherently illicit, but the speed, ease of use, and low fees make it attractive for criminal networks. During my career, investigators routinely came across:
- Mixing services
- Chain-hopping
- Privacy coins
- Decentralized exchanges
- NFT wash trades
- Tumblers and crypto-to-gift-card schemes
The challenge is that beneficial ownership in crypto does not resemble beneficial ownership in corporate structures. It can involve private key holders, controllers of wallets, individuals directing movement without holding assets, beneficial interest in pooled wallets, and custodial and non-custodial arrangements. In a traditional financial investigation, we usually know who the subject is but not how the money moved. With virtual assets, it is often the reverse. We can see the method and follow the money on the public blockchain, but we do not know who is behind it.
Professional Enablers
The role of professional intermediaries who facilitate illicit financial flows continues to pose a major threat to the stability of financial systems. They can include lawyers, real estate agents, trust company service providers, accountants, investment advisors, and wealth managers. Most are not criminals, but complicit enablers are the architects who make criminal structures possible.
I have seen attorneys create companies for clients they barely knew, accountants process transactions without oversight, and real-estate agents facilitate multimillion-dollar purchases via shell entities without asking questions. The U.S. is tightening rules around these sectors, but change takes time, especially involving Designated Non-Financial Businesses and Professions.
Compliance Leaders
1LOD officials are focusing on beneficial ownership validation rather than simple collection. Institutions must verify beneficial ownership, reconcile it with customer behaviour, and challenge inconsistencies. Public private partnerships will also strengthen compliance, including deploying AI-supported technology coupled with human judgment to identify red flags and minimize false positives. Compliance officials will continue:
- Detecting complex layering and obfuscation.
- Integrating crypto monitoring into mainstream AML systems.
- Strengthening SAR quality and proactive collaboration.
Cooperation and Collaboration
The first and second lines of defense are crucial to preserving the integrity and reliability of financial systems. Compliance officers, bank investigators, analysts, and frontline staff are the first line of defense. They see suspicious activity long before law enforcement.
The work is difficult and it will never be perfect. The tools have changed, but the mission remains the same. The United States has deep investigative experience, strong partnerships between the public and private sectors, and a generation of compliance professionals and financial investigators who know what to look for.