from The Daily Bell:
US Treasury to track cash buyers of prime real estate … The US Treasury has launched a test programme to track all-cash buyers of high-end real estate in New York and Miami, amid fears that the US property market has become a favoured destination for foreigners looking to launder ill-gotten assets. – Financial Times
Dominant Social Theme: To stay on top of criminality demands savvy detective work and enhanced anti-cash legislation.
Free-Market Analysis: The federal government is at it again, demanding that private industry compromise the privacy of clients because the state is wary of possibility of criminal acts.
Here’s how the Financial Times puts it:
The Treasury issued orders on Wednesday requiring US title insurance companies in Miami and Manhattan to identify the “natural persons” behind shell companies used to buy high-end real estate in many all-cash transactions. The temporary order, which will take effect March 1 and run for 180 days, is designed to gather data ahead of a possible more permanent rule change.
The article quotes Heather Lowe, legal counsel for Global Financial Integrity, as saying that title insurance companies probably do NOT have all the information necessary in all cases. She is willing to put the best face on the Treasury order, however, intrusive as it is, explaining it is likely an exercise in trying to find out just how much “ill-gotten money” was flowing into US real estate.
“What I think they are probably looking for is if there’s a dip in the market. Do the numbers rise some place else? What is the effect of putting this level of transparency in place,” she said. “They’ll probably use that data to see if there is a problem and a legitimate case for regulation.”
Terrence Oved, a New York real estate attorney, is quoted in the article as saying that the Treasury’s actions would lead to more permanent disclosure requirements, a situation he characterized as “disruptive.”
Please follow SGT Report on Twitter & help share the message.