Shell company
Definition
A legal entity with no real operations, employees, or assets of its own, used to hold money or property while hiding the identity of the person who actually controls it. Forming one is legal. It becomes a problem when used to disguise a transaction's true source or beneficiary.
Why it matters
Because incorporation in the US historically required no disclosure of the real owner, shell companies became a preferred layer for laundering illicit money, evading sanctions, and funneling anonymous or foreign money into elections and lobbying, hiding behind states like Delaware and Wyoming's minimal formation requirements.
Seen in the wild
Global Energy Producers LLC, a shell entity with no website, business history, or income, was formed in April 2018 and used weeks later to funnel $325,000 from a Russian national into the pro-Trump super PAC America First Action, a scheme that led to Lev Parnas's criminal conviction.1