Tax evaders, terrorists, drugs cartels and corrupt politicians don’t want to keep their dirty money their own names. So what they typically do is create a company – or a series of companies – and have the company own their assets. The company can open a bank account, it can buy a yacht or a mansion, and it can wire money around the world. And, importantly, it’s immensely difficult – sometimes totally impossible – to link the company back to the person who really owns it. This makes it an attractive method for hiding, moving, and using money or other assets.
It is quick, easy and cheap to create an anonymous company. In many countries, there is no public information available on the shareholders and directors of a company – you just simply can’t find out anything on who’s behind a company. This includes places that people equate with secrecy such as Caribbean islands but also includes places such as the US state of Delaware that are equally secretive.
Even in places that do make shareholder and director information public, it is still easy to create an anonymous company. This can be done either by listing another company as the owner or director (and making sure that company is registered somewhere that doesn’t make such information public), or by registering the company in someone else’s name, even that of a total stranger. Astonishingly, it’s entirely legal to do this in the majority of countries, and there’s an entire profession dedicated to providing such ‘nominee’ services.
Global Witness is campaigning to know who owns and controls companies and other corporate vehicles, so that they can no longer be used anonymously against the public good. The campaign is fast-moving:
- the UK became the world’s first country to promise to put the names of the ultimate owners of companies into the public domain in 2013.
- the G8 leaders agreed to take some first steps to deal with this problem in 2013.
- the EU is currently discussing whether or not to require all European companies to have to reveal who’s behind them. The European Parliament is in favour of creating public registries of the ultimate owners of companies and trusts.
- legislation has been proposed in the US that would increase transparency of companies. Read our press releases here and here.
- the UK’s Crown Dependencies and Overseas Territories have committed to carrying out public consultations on company ownership transparency.
- the G20 will be considering this issue later in 2014 too.
- The Grin, a video explaining why anonymous companies are a problem.
- Frequently asked questions on anonymous companies, and why they’re a problem
- An infographic laying out the problem with anonymous companies
- An idiot’s guide to anonymous companies, a spoof leaflet describing how easy it is to set up an anonymous company
- Poverty, corruption and anonymous companies, a briefing document that outlines why anonymous companies are a problem and how they exacerbate poverty
- Real life examples of how anonymous companies have aided tax evasion, sanctions busting and corruption
Read our in-depth reports:
- Company ownership: which places are the most and least transparent? A joint Global Witness-Christian Aid report, November 2013
- Grave Secrecy: how a dead man can own a company and other hair-raising stories about company ownership from Kyrgyzstan and beyond An investigation by Global Witness into a major money laundering scandal, June 2012
- International Thief Thief: how British banks are complicit in Nigerian corruption An investigation by Global Witness into how Barclays, NatWest, RBS, HSBC and UBS took money from corrupt Nigerian governors. October 2010
- The secret life of a shopaholic: how an African dictator’s playboy son went ona multi-million dollar shopping spree in the US, November 2009
- Undue Diligence: how banks do business with corrupt regimes An investigation by Global Witness that names some of the major banks that have done business with corrupt regimes, March 2009
- One year after the UK’s G8 presidency, how well have eight countries done in living up to their promises on tax and transparency? A briefing by Global Witness, Christian Aid, Action Act and the Financial Transparency Coalition.
- A blog about how an anonymous UK company owned Viktor Yanukovych’s presidential palace compound, March 2014
- Response to the UK consultation on company ownership transparency, September 2013
- Influential corruption hunters call for information on the ultimate owners of companies to be in the public domain, June 2013
- Letter from civil society to President Obama in support of company ownership transparency, June 2013. The letter is from the Financial Accountability and Corporate Transparency (FACT) coalition, of which Global Witness is a member.
- The Africa Progress Panel, led by Kofi Annan, calls for the G8 and G20 to have public registers of the ultimate owners of companies, May 2013
- Research into the costs of putting beneficial ownership information into the public domain, May 2013
- Mystery shopping exercise shows how easy it is to set up anonymous companies in the U.S. and UK, blog about a study showing how many company service will set up a company without seeing a copy of the ultimate owner’s passport, October 2012
- Dictators’ riches are stolen at home, but banked in the west, blog Equatorial Guinea, September 2012
- How the Financial Action Task Force can measure and promote an effective anti-money laundering system, a detailed policy paper about how to measure effectiveness, June 2012
- New documents detail alleged grand corruption in Equatorial Guinea, press release, June 2012
- Massive ICIJ exposé on offshore secrecy should spur G8 action, press release, April 2012
- Organisations representing more than 1,000 civil society groups calls on the EU to make company ownership transparent, June 2012
- Civil society submission to the G20 anti corruption working group, February 2012
- Submission to the UK Foreign Office overseas territories consultation, December 2011
- Submission to the Financial Action Task Force in response to standards review, September 2011
Coalitions that we’re part of that work on the issue of anonymous companies
- Financial Transparency Coalition
- Financial Accountability and Corporate Transparency (FACT) coalition
What we've been reading
global witness in the press
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