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HR 2816119th CongressIn Committee
Shell Company Abuse Act
Introduced: Apr 10, 2025
Standard Summary
Comprehensive overview in 1-2 paragraphs
Shell Company Abuse Act would make it illegal to establish or use a corporation, company, or other entity with the specific intent to conceal foreign-national activity prohibited under federal election law. The offense targets the people who create or run such entities—owners, officers, attorneys, or incorporation agents—and would apply when the intent is to hide foreign-national contributions or donations that are prohibited by FECA (the Federal Election Campaign Act). A violation carries up to 5 years in prison, plus possible fines. The bill adds a new Section 612 to Chapter 29 of Title 18, United States Code, to codify this offense.
Key Points
- 1Prohibition scope: It is unlawful to establish or use a corporation or similar entity to conceal activity by a foreign national that is prohibited under FECA (52 U.S.C. 30121), i.e., foreign-national election contributions or donations.
- 2Who is liable: The offense can be committed by an owner, officer, attorney, or incorporation agent of a corporation or other entity.
- 3Intent requirement: The law targets actions taken with the intent to conceal the prohibited activity; mere existence of a shell is not enough—there must be intent to hide the prohibited conduct.
- 4Penalty: Violators may be imprisoned for up to 5 years, fined, or both.
- 5Administrative change: The bill adds a new Sec. 612 to Chapter 29 of Title 18, creating a new criminal offense specifically for establishing or using shell corporations to conceal foreign-national election activity.
Impact Areas
Primary: Individuals and entities implicated in creating or operating shell corporations (owners, officers, lawyers, incorporation agents) who intend to conceal foreign-national election activity.Secondary: Political campaigns and political committees, as well as corporate service providers (law firms, formation agents) who could be involved in setting up or maintaining shell structures.Additional impacts: Increased enforcement risk and potential chilling effect on certain corporate-formation practices; potential interactions with existing FECA provisions governing foreign contributions and corporate political activity.
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