Farah Stockman writes in the New York Times that American real estate was a money launderer’s dream. However, that is starting to change…(NYT)
Cleveland has now become a poster child for the need for more transparency in the U.S. real estate industry. A raft of new anti-money laundering laws and regulations is aimed at the industry, which has attracted more than $2 billion in illicit funds over a recent five-year period, according to one report. Chipping away at the culture of anonymous ownership is a good thing, and is long overdue. But the new rules won’t address the elephant in the room: Many cities and small towns, especially in the American Midwest, badly need investment, and sometimes shadowy foreign money is the only kind that comes calling.
“Over and over again, Kolomoisky and his network allegedly turned to Middle America — overlooked towns, forgotten areas, regions that needed an economic lifeline, whatever the source — for their massive laundering needs,” Casey Michel, the author of “American Kleptocracy: How the U.S. Created the World’s Greatest Money Laundering Scheme in History,” wrote recently in Foreign Policy magazine. “Those on the receiving end had no incentive to look this foreign gift horse in the mouth, even when the signs of money laundering were clear.”