- New Rules Aim to Strengthen US Financial Security and Combat Illicit Finance
WASHINGTON, USA – On Wednesday, August 28, 2024, the US Department of the Treasury announced the implementation of two significant rules designed to enhance the integrity of the residential real estate and investment adviser sectors amidst growing concerns over illicit financial activities. These rules are aligned with the ongoing objectives of the Biden-Harris administration’s U.S. Strategy on Countering Corruption.
US Secretary of the Treasury Janet L. Yellen emphasized the critical need to disrupt the exploitation of US financial systems for money laundering and corrupt practices. “These new regulations are essential in closing key loopholes that have historically allowed bad actors to engage in activities such as corruption, narcotrafficking, and fraud. Our commitment to safeguarding the residential real estate and investment adviser sectors will be strengthened by these measures,” she stated.
The new residential real estate rule mandates that select real estate professionals report transactions involving non-financed transfers to legal entities or trusts, which have been identified as posing a high risk of illicit finance. This initiative aims to enhance transparency, making it more challenging for criminals to launder money through the American housing market and assisting law enforcement in their investigations.
Additionally, the new investment adviser rule introduces anti-money laundering and countering the financing of terrorism (AML/CFT) measures that will be applicable to certain investment advisers registered with the US Securities and Exchange Commission (SEC). By ensuring consistent AML/CFT compliance across the industry, this rule addresses existing disparities in the regulatory landscape.
Through a meticulous rulemaking process, the Treasury has taken public feedback into account, engaging with industry representatives and key stakeholders to craft regulations that promote effectiveness while minimizing the administrative burden on businesses, including small enterprises.
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