State Representative John Kowalko has introduced a bill that attempts to regulate the wild and unrestrained use of the LLC entity under Delaware law for all sorts of types of nefarious purposes (i.e. silencing porn stars who have affairs with the President) by infamous criminals.
HB57(S) says that the Secretary of State shall not certify for formation or domestication nor register a limited liability company (LLC) for any person, group, organization, or government placed on the lists of the Active Sanctions Program of the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury (DOT) whether requested by a registered agent or the sanctioned person, group, organization or government directly. Further, registered agents under contract with the Department of State, Division of Corporations, shall use the OFAC sanctions lists to screen potential clients in order to avoid filing certificates for formation, domestication, or registration of a limited liability company for persons, groups, organizations, or governments whose names appear on said lists. The Secretary of State shall provide to all registered agents a link to the OFAC website and its Resource Center.
The bill says other registered agents who file applications for clients shall also use the OFAC sanctions lists to screen out potential clients who appear on any of the sanctions lists. Registered agents identifying a match of an applicant with a name on one of the sanctions lists shall not be required by this law to report the match to any government authority. The registered agent’s obligation will be to simply reject the applicant as a client.
My question: if the registered agent does not meet his obligation to reject the applicant, what is the sanction or punishment? Nothing?
I say disbarment, as most registered agents are attorneys in Delaware.
HB57(S) – LLC Reform
SPONSORS – Kowalko, Ennis, K. Williams
STATUS – House Judiciary 3/15/18
HISTORY – Waiting on a hearing