DES MOINES | The “Panama Papers” — leaked documents from a Panama-based law firm that sets up anonymous shell companies for clients – may provide a spark for legislation Sen. Chuck Grassley says will increase corporate transparency.
“Transparency brings accountability. You get back to something that’s pretty basic to everything I do in government,” said Grassley, chairman of the Senate Judiciary Committee. Along with Rhode Island Democratic Sen. Sheldon Whitehouse he is co-sponsoring the Incorporation Transparency and Law Enforcement Assistance Act that would ensure the disclosure of beneficial owners in the United States.
The “Panama Papers,” the result of an investigation by the International Consortium of Investigative Journalists and more than 100 news outlets, illustrate the use of shell corporations by wealthy individuals, politicians and businesses to hide legal activities.
“The tool is used to avoid, well, I don’t know whether it would be just taxes or a lot of things other than taxes,” Grassley said. “Who knows about the underworld being involved, money laundering and I don’t know how many other things.”
When Iowa Citizen Action Network in Des Moines hosted a two-day seminar on the subject it attracted representatives of the faith community, small business and law enforcement. Much of their concern was the use of shell companies in human and drug trafficking, said Sue Dinsdale, ICAN executive director.
“I’ve been working on this for the past couple of years,” Dinsdale said. “It never gets a lot of traction because it’s not real exciting. But the ‘Panama Papers’ got people thinking and brought this to the forefront.”