A corporate lobbying group backed by Koch Industries is quietly pressing the Democratic New York governor, Kathy Hochul, not to sign a landmark transparency bill unmasking the owners of shell corporations involved in financial crimes, wage theft and tenant abuses.
High-profile real estate donors to Hochul’s campaign also oppose new disclosure requirements for limited liability companies, or LLCs, a notoriously opaque corporate structure that can thwart attempts at both civil and criminal law enforcement by concealing owners’ true identities.
Hochul has yet to say whether she will sign the bill, passed by the New York legislature in June, requiring LLCs to report that information – and creating a first-in-the-nation database providing public access to it.
Since taking office in 2021, Hochul has accepted nearly $2.1m in campaign contributions from real estate and other companies registered as LLCs, according to a Guardian review of state records.
While many businesses incorporate as LLCs to take advantage of perfectly legal tax benefits and liability protections, federal anti-money-laundering authorities call the entities “inherently vulnerable to abuse”. As such, they are often the vehicles of choice for money launderers, tax cheats and a host of other actors seeking to remain in the shadows.
High earners create fake companies with no purpose other than to move money and dodge income taxes. Bad bosses attempt to hide serial wage theft within an alphabet-soup of subsidiaries. Anonymous owners are especially pervasive in the real estate market, where foreign oligarchs stash their ill-gotten cash in luxury condos and high-profile property owners obscure their business dealings through a web of difficult-to-trace entities.
Last month, a coalition of housing, labor and transparency groups rallied alongside state lawmakers to urge Hochul to sign the LLC transparency act, which mirrors – but exceeds – new federal disclosure requirements set to take effect next year.
Among the groups pushing Hochul in the opposite direction is the dark-money-funded National Federation of Independent Business (NFIB), which does not disclose its donors but has in the past received at least $2.5m from sources linked to the Koch network. The self-described “voice of small business” is known for opposing regulations ranging from Obamacare to paid sick days to child labor laws – and in its most recent New York lobbying disclosure, NFIB reported lobbying Hochul directly on the corporate transparency bill.
In July testimony before Congress, the NFIB vice-president, Kevin Kuhlman, called corporate disclosure requirements a “massive government dragnet” and warned that “small businesses will be named and shamed by those who do not agree with their business practices or political positions”.
Advocates say that the United States is already a global outlier when it comes to the secrecy afforded to corporate entities.
In 2019, transparency researchers concluded that all 50 US states required more personal information to obtain a library card than to create a company. New York’s bill, if signed, would provide the public with the legal name, business address and birth year of LLCs’ so-called “beneficial owners” – the person or people ultimately controlling the entity – with waivers available in the case of legitimate safety or privacy concerns.
“In the rest of the world, this is largely public information,” said Erica Hanichak, the government affairs director at the Fact Coalition, a corporate-transparency group. “The public deserves to understand who owns and participates in their communities.”
Nationwide, about 15% of rental properties are owned by LLCs or related entities, according to data from the US Census Bureau. It is increasingly common for tenants to find themselves in the dark about who their landlord is, never mind how to contact them or take them to court if needed.
In Manhattan, a recent data analysis found that nearly 40% of properties are owned by LLCs, making the area a hot spot for both illicit real estate practices and more run-of-the-mill predatory ones. A 2018 BuzzFeed investigation uncovered that more than one-fifth of residential condos in Trump-owned developments – and a full 77% in one Manhattan building – were all-cash purchases by LLCs and other anonymous shell companies, telltale signs of possible money laundering.
The real estate lobby has also mounted some of the fiercest opposition to New York’s enhanced corporate transparency requirements. After reportedly working behind the scenes to kill a previous version of the transparency bill, the Real Estate Board of New York (Rebny), which represents developers in New York City, reported spending $84,000 on lobbying this year on legislation including the LLC reporting measures.
While few individual firms have adopted a public position, Tishman Speyer, a mega- developer of luxury condos and other real estate, also reported lobbying on the bill. The firm and its executives have contributed more than $150,000 to Hochul’s campaign fund.
Rebny was not opposed to disclosure of ownership information to regulators and law enforcement, said Zach Steinberg, the group’s senior vice-president of policy, in a statement emailed to the Guardian.
“However, the legislation passed in New York takes the unnecessary and harmful step of creating a publicly available database which creates privacy and identity theft risks for New Yorkers and risks weakening New York’s economy,” he said.
Tishman Speyer did not respond to the Guardian’s request for comment.
Real estate interests are among the largest donors to Hochul’s 2026 re-election campaign, with multiple executives at major firms maxing out their contributions, according to a recent report in City & State.
Asked by the Guardian about the contributions and her position on the bill, a spokesperson for Hochul said she would review the legislation.
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If signed into law, New York’s transparency measures could shed light on shadowy real estate actors – and help fill a critical gap left by forthcoming federal requirements set to take effect next year.
In 2021, Congress overrode a Trump veto to pass the Corporate Transparency Act, a sweeping overhaul of the nation’s anti-money-laundering regime that tasked federal regulators with creating a company-ownership registry.
Amid a furious corporate backlash – NFIB reported spending more than $2.3m on issues including opposition to the federal bill from 2019-2020 – the final version included several substantial loopholes that advocates warned could weaken its effectiveness. Among them, the new law mandated that ownership be maintained in a “secure, nonpublic database” accessible to law enforcement – but not to researchers, journalists or other civil society groups hoping to follow the money.
Advocates are hoping that New York’s public database will begin to pull back the curtain on shell companies. That’s exactly what concerns opponents.
With federal corporate transparency requirements set to take effect in January, regulators are still finalizing a rule governing the security of and access to the information. In July testimony before a House subcommittee on illicit finance, NFIB’s Kuhlman called on Congress to repeal the federal transparency legislation before it takes effect, citing New York’s proposed measures as evidence of a slippery slope.
“Transparency advocates will continue to push to expand [beneficial ownership information] reporting requirements,” Kuhlman said. “Please resist calls to make the federal beneficial ownership database public.”
NFIB did not respond to a request for comment.
In New York, housing advocates who will be blocked from accessing federal ownership data hope that a state registry will make it easier to hold landlords accountable.
At present, tenants seeking help from the courts over poor building conditions frequently hit a dead end when asked to provide their landlord’s address, according to Andrea Shapiro, the director of programs and advocacy at the Metropolitan Council on Housing, a tenants’ rights organization.
“If you pay your rent through an online portal, sometimes the only address you have is something like ‘123 Street LLC,’” Shapiro said. While it’s often technically possible to locate the owner through public records research, she said: “It takes a lot of work, and many tenants won’t have the time, energy or knowledge.”
Among the most recent backers of the transparency bill is the New York attorney general, Letitia James, who wrote on the social media platform X that it would “help protect New Yorkers from bad landlords, wage theft, tax cheats, and corruption”.
Last year, James reached a $4m settlement with 29 separate LLCs – all affiliated with a single real estate firm – that she alleged had illegally deregulated rent-regulated units within the 2,500 apartments they owned citywide. Tenant advocates say that landlords regularly deploy single-address LLCs to disguise patterns of bad behavior across multiple buildings.
With prominent state politicians on board, along with unions and housing and transparency groups, the bill’s sponsors are hopeful that Hochul will act on the bill before the end of the year, at which point it would become subject to an automatic veto within 30 days.
“The breadth of this coalition is a testament to how many facets of society and the economy are impacted by secret shell companies,” the Democratic assembly member Emily Gallagher, one of the bill’s chief sponsors, told the Guardian. “Now we are looking to Governor Hochul. She came into office promising a new era of transparency. This is her opportunity.”
