Wealthy individuals around the world are always on the lookout for safe and profitable investment opportunities. Some of those wealthy individuals earned that money through criminal activity, and the United States is on the hunt for tax evaders and criminals using shell companies to act as secret buyers of luxury homes.
Global millionaires and billionaires are limited from the major financial markets if their wealth was accumulated through less-than-reputable means. And even some otherwise law abiding citizens may be looking for tax shelters and a safe heaven where they know their asset is protected and safe.
United States luxury homes in New York City and Miami have been particularly popular for this type of activity. Foreign investors create a shell corporate, sometimes registered in tax havens like the Bahamas or Cayman Islands.
Using a shell corporation is legal in United States real estate, but using them to hide your identity and avoid taxes and money laundering charges is not. That’s why the United States Treasury Department is now requiring that the true owners of luxury homes in the United States should no longer be secret buyers.
The New York Times investigated one luxury condo complex near Central Park and found a number of secret buyers. It turns out that those owners included top foreign government officials including former Russian seantors, a former governor from Columbia, a British investor, and a businessman tied to the prime minister of Malaysia.
These wealthy and powerful individuals have been hiding their assets away in luxury properties in the United States for many years, but this type of activity looks to be coming to an end if the Treasury has their way. Maybe this isn’t a typical real estate transaction but I wonder if the agents knew.
Read the entire story at the New York Times.