Deputy Secretary Wally Adeyemo said the Treasury Department needs to investigate the use of litigation funds in the United States by foreign parties.
“This is an issue that we have to look at, and we have to address and address,” Adeyemo said in testimony at a Senate hearing.
His comments came after Sen. Bob Menendez (D.N.J.) asked if he thought a lack of transparency in the litigation finance industry could create a rift in sanctions enforcement. Menendez said the company, founded by a Russian billionaire with ties to Russian President Vladimir Putin, was in New York and London both before and after three of its founders were sanctioned following the 2022 invasion of Ukraine. He cited a Bloomberg Law investigation that found support for the lawsuit.
“One of the challenges we have is, of course, that the Russian oligarchs are very adept at trying to circumvent our sanctions,” Adeyemo said on Tuesday. Ta. “From what I see, this is one of several ways they're trying to make it happen.”
Menendez also cited a 2022 Government Accountability Office report that found that sovereign wealth funds may be investing in litigation finance, and patent litigation financed by foreign companies. raised the issue.
Asked if he thought legislation was needed to increase transparency in the industry, Adeyemo said he would like to work with Menendez's office and that his team believes such legislation is necessary. He said he would come to him if he could.
The Senate Banking, Housing, and Urban Affairs Committee held a hearing to obtain an update on illicit finance, terrorism, and the Treasury Department's efforts to evade sanctions. Mr. Menendez was indicted by federal prosecutors in Manhattan last year on charges that he provided confidential U.S. government information and took steps to secretly assist Egypt. He is a senior member of the Banking Committee.
Last year, House Speaker Mike Johnson (R-La.), Sen. John Kennedy (R-La.), and Sen. Joe Manchin (D-Va.) introduced legislation that would regulate the ability of foreign companies to fund litigation. submitted. A bill to protect courts from foreign manipulation, which has not been considered in committee, would require disclosure of foreign agents and investors funding lawsuits. It would also prohibit sovereign wealth funds and foreign governments from funding U.S. litigation.
