Contact Us

Senate Continues Its Investigation Of Money Laundering Through High-Valued Real Estate

Sen. Sheldon Whitehouse

The U.S. Senate is continuing its search for ways to better expose money laundering through high-price real estate.

Democratic Sens. Sheldon Whitehouse and Chris Van Hollen sent an open letter to the Government Accountability Office asking for information on the Treasury Department's investigations into money laundering, the Wall Street Journal reports.

The department's Financial Crimes Enforcement Network, also known as FinCEN, started requiring the names of persons behind limited liability companies purchasing "high-value" property in New York, Miami, San Francisco, Los Angeles, San Antonio and Honolulu in cash in 2016. Whitehouse and Van Hollen asked the GAO for data that FinCEN has been collecting over that time, and to see if the enforcement organization would request any regulatory changes, according to the WSJ.

The letter was sent two months after Republican Sen. Lindsey Graham introduced a bill that would further require an LLC to disclose the investors behind the corporations storing capital in high-value real estate nationwide, indicating rare bipartisan support for increased transparency in these dealings. Graham was especially concerned about foreign entities using property purchases to destabilize the U.S. economy, naming his bill "The Defending American Security from Kremlin Aggression Act."

Since the Treasury Department heightened disclosure requirements in 2016, all-cash real estate transactions have decreased by 70% nationwide, even in areas not under increased scrutiny. (In 2017, U.S. government officials settled a controversial money laundering case with a Russian entity out of court.) Whitehouse and Van Hollen asked the GAO to help shed light on the correlation between that decrease in all-cash real estate deals and the increased scrutiny, the WSJ reports.