Real estate industry unhappy that Congress is cracking down on Russian money laundering: report

Real estate industry unhappy that Congress is cracking down on Russian money laundering: report
Russian President Vladimir Putin in May 2021, Wikimedia Commons

The powerful real estate lobby appears to be siding with oligarchs in opposing tougher new laws that would prevent them from hiding their assets in U.S. property purchases.

Even before Russian President Vladimir Putin sent troops into Ukraine Washington lawmakers were crafting legislation that would shred the secrecy veil that hides the identities of foreign nationals who purchase billions of dollars of U.S. real estate every year. Momentum for those reforms only has grown since Russia's invasion and the worldwide focus on seizing oligarchs' assets.

Politico reports that House Financial Services Chair Maxine Waters (D-Calif.) soon plans to introduce legislation to strengthen anti-corruption laws related to the industry. And Sen. Sheldon Whitehouse (D-R.I.), is pressuring the Treasury unit known as FinCEN (Financial Crimes Enforcement Network), to craft strict rules to cut down on money laundering through property holdings.

“American real estate can’t be a dark repository for oligarch money,” Whitehouse told Politico.

But the National Association of Realtors (NAR), the industry’s biggest lobbying group, is resisting powerful reforms, instead calling for “tailored reforms that address specific issues,” according to spokesperson Patrick Newton.

“This approach focuses on illegal activity while minimizing any negative impact on the real estate economy, which makes up nearly one-fifth of the overall U.S. economy,” Newton said. “NAR has confidence that targeted and effective policy will prevail in the rule-making process.”

NAR has a huge stake in the issue. According to its own industry research, foreigners made up 8.6 percent of all commercial buyers in 2021 and 59 percent of commercial real estate transactions in the U.S. that included buyers from overseas involved all-cash purchases between 2016 and 2020.

Under today's laws, anyone, including a foreign national, can form an anonymous company and have that entity use cash to purchase residential or commercial real estate. That's one way oligarchs and others have been parking their money in the U.S. That’s a key reason that Treasury Secretary Janet Yellen said in December, “There’s a good argument that, right now, the best place to hide and launder ill-gotten gains is actually the United States.”

Understand the importance of honest news ?

So do we.

The past year has been the most arduous of our lives. The Covid-19 pandemic continues to be catastrophic not only to our health - mental and physical - but also to the stability of millions of people. For all of us independent news organizations, it’s no exception.

We’ve covered everything thrown at us this past year and will continue to do so with your support. We’ve always understood the importance of calling out corruption, regardless of political affiliation.

We need your support in this difficult time. Every reader contribution, no matter the amount, makes a difference in allowing our newsroom to bring you the stories that matter, at a time when being informed is more important than ever. Invest with us.

Make a one-time contribution to Alternet All Access, or click here to become a subscriber. Thank you.

Click to donate by check.

DonateDonate by credit card
Donate by Paypal
{{ }}
@2023 - AlterNet Media Inc. All Rights Reserved. - "Poynter" fonts provided by