Recently, a bipartisan bill was introduced in the United States Senate that would require states to obtain the identity of persons who act behind corporations.  Essentially, this legislation would end the practice of unidentified persons forming corporations and remaining invisible. 

In particular, the legislation is designed to prevent hidden and faceless persons from running or hiding behind corporate entities.  The legislation would not require states to verify the information, but penalties would apply if any information was submitted falsely to the states.  The senators who introduced this legislation, specifically, are concerned about the potential for problems arising in shelf registrations as well as financial fraud.  Although the legislation has the support of a bipartisan group of senators, and a variety of law enforcement officials, it is not supported by regulated companies or financial services institutions. Further, the organization for Secretaries of State is against the legislation.  This organization claims the proposed legislation will increase burdens on their offices, who are already dealing with reduced state budgets.

In short, this bill may not ultimately succeed especially given that a prior version was defeated earlier.  However, one wonders if the states will take up this cause and require such information given the extent of the perceived issues relating to financial fraud in today’s markets.