With The Atlantic, I took a look at how the U.S. has transformed into a shell company empire - and the kind of company it attracts:
When Viktor Bout—the arms dealer extraordinaire who inspired the 2005 Nicolas Cage movie Lord of War—sought to set up anonymous shell companies, according to a Senate panel, he turned to, of all places, the U.S. So too, court documents indicate, did former Ukrainian Prime Minister Pavlo Lazarenko, a man who has landed on Transparency International’s list of the 10 most corrupt officials. Per a Senate report, the same was true of the accused kleptocrat Teodoro Nguema Obiang Mangue, the son of Equatorial Guinea’s president, who went on to forfeit more than $30 million worth of mansions and sports cars to American officials (but somehow managed to hold onto Michael Jackson’s crystal-studded glove).
For this trio, America happened to provide the proper marriage of a stable, independent legal system and complete anonymity. While traditional offshore havens from the United Kingdom to the Cayman Islands have recently lurched, however unwillingly, toward greater transparency and financial oversight, people like Lazarenko and Obiang eyed the U.S., the jurisdiction that over the past few years has cemented its position as perhaps the foremost shell-company provider globally. “In some places [in the U.S.], it’s easier to incorporate a company than it is to get a library card,” said Joseph Spanjers of the think tank Global Financial Integrity last year, describing the ease with which anyone could set up a shell company in states such as Delaware, Nevada, or Wyoming. ...
And as has been the case for several years, anyone with a bit of money can set up their own American shell companies, hiding their wealth from whoever may be after it. This includes arms dealers and despots from sub-Saharan Africa and Central Asia, as well as drug cartels, oligarchs, and autocrats. Anyone trying to keep their malevolence inconspicuous, even those acting directly against American interests, need not look far to cloak their wealth. After all, one of the U.S. companies allegedly tied to Bout was used to funnel arms to the Taliban. As one lawyer specializing in shell companies recently wrote, “It’s not entirely beyond the realms of possibility that ISIS could be operating companies and trust funds domiciled in Delaware.”