President Biden on Thursday issued a memo that establishes anti-corruption efforts as a core U.S. national security interest and that is intended to get federal agencies to step up efforts on tackling corruption and illicit financing schemes.
Mr. Biden said the U.S. plans to lead by example in what he described as a worldwide mission.
“Corruption is a risk to our national security, and we must recognize it as such,” the president said in a statement. “Fighting corruption is not just good governance. It is self-defense. It is patriotism. And it’s essential to the preservation of our democracy and our future.”
Senior administration officials said the National Security Study Memorandum (NSSM) builds on efforts already underway at departments like Treasury and Justice to crack down on shell companies and kleptocracy.
“The essence of the memorandum … is that the U.S. government is placing the anti-corruption fight at the center of its foreign policy,” a senior administration official told reporters.
The NSSM is the first such memo to be issued by the administration since Mr. Biden took office in January.
The memo serves as “formal and public direction from President Biden that he expects all relevant federal departments and agencies to up their anti-corruption game in very specific ways,” an official said.
It directs Mr. Biden’s national security team to develop a report and recommendations within 200 days on how the government and its partners can better fight corruption and tackle illicit finance.
Mr. Biden estimated that “acts of corruption” cut the size of the global economy by 2% to 5%.
“Anonymous shell companies, opaque financial systems, and professional service providers enable the movement and laundering of illicit wealth, including in the United States and other rule-of-law-based democracies,” he said in the memo.
The effort could involve cracking down on “illicit actors” who try to use anonymous shell companies to facilitate their misdeeds and limiting bad actors’ ability to anonymously purchase residential real estate, according to the White House.
The announcement comes days before Vice President Kamala Harris is scheduled to travel to Guatemala and Mexico next week.
Combating corruption in the Northern Triangle countries of Guatemala, El Salvador and Honduras has been a longtime U.S. priority. The Biden administration has struggled to contain a surge of migrants trying to travel across the U.S.-Mexico border in recent months.
“I don’t want to get ahead of any announcements that are going to be made on the trip, but I can say that anti-corruption in the region is a major focus for the administration and will be a focus of all of her conversations while she’s traveling,” an official said.
The U.S. already imposes sanctions on foreign individuals and companies in the context of broader anti-corruption and punitive efforts, but an official said sanctions aren’t the only tool as part of the administration’s broader efforts to tackle corruption.
“We’re looking to make significant, systemic changes to the regulatory structure that governs illicit finance; we’re looking to increase the use of law enforcement tools to go after corrupt actors,” the official said. “We’re looking to improve upon U.S. foreign assistance as a tool and increase the role that anti-corruption plays in our day-to-day diplomatic work.”