Switch to ADA Accessible Theme
Close Menu
Washington DC Business Lawyer
~ Washington DC Business Law Attorneys ~

The Real Estate Business Could Soon Be Under Increased Scrutiny For Money Laundering


The real estate business is constantly changing.  Tax deductions that were a boon to real estate investors one year disappear the next, and new tax breaks take their place, meaning that you must relearn how to qualify for them.  Cryptocurrency and blockchain tokenization have also started to play a major role in the real estate industry in recent years.  All of these changes do not even account for the fluctuation of prices of residential and commercial real estate properties, even when the factors affecting these fluctuations are nowhere near the magnitude of a global pandemic.  Real estate investors should be on the lookout for new restrictions and regulations that may be starting soon, in light of an announcement by President Biden to increase efforts to prevent money laundering through real estate.  This means that, if your company is planning to purchase a real estate property, especially if you will be paying for it in cash for cryptocurrency, you will need even more help from a Washington DC real estate lawyer to ensure that you are fully complying with the law.

Global Financial Integrity Sounds the Alarm About Real Estate Money Laundering

Global Financial Integrity, a think tank based in Washington, D.C., published a disturbing report about the outsized role that real estate plays in money laundering in the United States.  According to the report, at least $2.3 billion that have been spent on real estate in the past five years have been the proceeds from illegal activities.  The report also described U.S. real estate properties as a “safe haven” for the fortunes of foreign plutocrats; it identified properties purchased to hide the wealth of notables from foreign countries including Russia, Ukraine, Venezuela, Equatorial Guinea, and Kuwait.  This does not even count the properties purchased with the proceeds of illegal drug sales by U.S.-based dealers.  Unassuming properties titled in the name of shell corporations are just as likely to have been purchased with laundered money as ostentatious ones.  Money launderers are just as likely to buy a strip mall in Cumberland as a mansion in Potomac.

When President Biden first took office, he imposed stricter regulations on shell corporations, requiring them to disclose the identity of the individuals in control of them.  Recently, he announced plans to increase enforcement of anti-money laundering laws.  He indicated that he would propose new legislation to enable regulators to stop money laundering through real estate before it starts.  For example, real estate agents who facilitate the purchase of real estate property by companies are not required to disclose the identity of the people connected to those entities but that may change soon.

Contact an Attorney for Help

Buying a real estate property can be as legally complex as establishing or operating a business.  A real estate lawyer can help you keep up with the constantly changing laws surrounding the sale and purchase of commercial and residential real estate properties.  Contact Tobin O’Connor Concino P.C. for help.



Facebook Twitter LinkedIn