Senators call for investigation into real estate money laundering law vulnerabilities

Two Democrats say there is far less oversight on the residential side than the lending side

TRD NATIONAL /
Oct.October 03, 2018 07:04 PM

Chris Van Hollen and Sheldon Whitehouse(Credit: Ervins Strauhmanis via Flickr)

The risk of money laundering in residential real estate is high.

That’s according to two U.S. senators who are calling for an investigation to probe the potential vulnerabilities of existing U.S. money-laundering provisions, according to the Wall Street Journal.

Chris Van Hollen of Maryland and Sheldon Whitehouse of Rhode Island, both Democrats, sent a letter to the Government Accountability Office, saying the real estate sector has less far oversight when it comes to money laundering than the lending sector.

That fact, they wrote, presents “increased risk of access by foreign and domestic criminal organizations,” the Journal reported.

In South Florida, federal authorities are looking to seize 16 high-end properties that are alleged to be tied to the defendants of a $1.2 billion Venezuelan money laundering case.

The letter comes a day after a sweeping New York Times investigation found that President Donald Trump and his family engaged in a series of elaborate schemes — including some that could be illegal — to avoid paying taxes on the family’s vast real estate empire. 

The lawmakers’ request includes an assessment of the Department of Treasury’s Financial Crimes Enforcement Network, or FinCEN.

In 2016, it began requiring title insurance companies to report the identities of individuals behind all-cash buys in vulnerable locales like Miami.

Lawmakers are moving to expand that program from just a handful of U.S. cities to all stateside transactions. 

A letter from the senators asks how FinCEN has used the data to help fight money laundering. Political infighting has hampered efforts to crack down on money laundering in the U.S., even with the new FinCEN reporting requirements in place. [WSJ] – Dennis Lynch


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