Top real estate lawyers offer advice on moving shady money into US: report

Feb.February 02, 2016 10:01 AM

From the New York website: Several top New York real estate lawyers – about a dozen in all – were caught on video providing advice to undercover investigators who posed as representatives of shady foreign officials seeking to move money into the United States, according to an investigation by transparency advocate Global Witness.

The investigation follows a recent move by the U.S. Treasury to require all-cash buyers of Manhattan residential properties over $3 million to disclose their identities, part of a wider crackdown on alleged money laundering in the real estate industry, reported in the New York Times.

The Real Deal has outlined several potential workarounds for the new rules, including the use of “straw man” buyers — trusted third parties — and wire transfers, which aren’t classed as “all cash” deals.

John Jankoff of Jankoff & Gabe P.C. was recorded telling Global Witness investigators — who claimed to represent an African mining minister – about the possibility of establishing anonymous Swiss bank accounts.

“If it’s not in his name,” Jankoff told the undercover advocates, “then he needs what is known as a straw man.”

Gerald Ross of Fryer & Ross L.L.P. raised the possibility of using his firm’s bank accounts as a conduit for transferring the fake minister’s money into the country, according to Global Witness.

“It’s not because they’re hiding money,” Ross later told the New York Times. “It’s because they’re afraid of being screwed by somebody.”

A recent president of the American Bar Association, James Silkenat, now of Sullivan & Worcester made clear to investigators that he couldn’t assist them with anything illegal, but nonetheless said there were “other banking systems that are less rigorous on this than the U.S.”

He told investigators his firm “could provide you with the list of countries where the banking systems require less detail on ownership or source of funds.”

Silkenat told the Times his advice was aimed at addressing privacy concerns. He said he had tried to make clear “we would be a wholly ill suited choice as legal counsel for any potential client who was looking to violate U.S. or foreign money laundering or other laws.” [NYT]Ariel Stulberg

Related Articles

Treasury extends LLC disclosure rule, but to what effect?

Treasury extends LLC disclosure rule, but to what effect?

Special Report: Inside the title insurance cartel

Special Report: Inside the title insurance cartel

Stephen Kotler London Hotel

LLC disclosure law may impact celebrity privacy, top LA brokers say


7 ways to avoid the new LLC disclosure law

Millionaire, show thyself: What does the Treasury’s move mean for real estate?

Millionaire, show thyself: What does the Treasury’s move mean for real estate?

The biggest sales in LA

Here are the biggest resi sales in LA County

6550 South Normandie Avenue (Credit: Google Maps)

Haroni Investments to turn parking lot into new apartments

110-unit mixed use development

Pourbaba gears up for $20M West Adams project