Who owns businesses in California? A lawmaker wants the public to know

FILE - State Sen. Maria Elena Durazo, D-Los Angeles, addresses a gathering in Sacramento, Calif., May 20, 2019. This year, Durazo, has introduced a bill to require business owners and landlords to disclose their identities under legislation aimed at cracking down on opaque ownership structures that have enabled some companies to skirt state laws without facing consequences. SACRAMENTO, Calif.

Durazo said the lack of that crucial information has allowed people to set up business structures where one company is owned in the name of another, all to shield their identities from the public, government officials and even law enforcement agencies. In many cases, local and state officials must spend significant time and resources to track down the owners before they can charge or sue the business for violating state laws, if they can find them at all.

The legislation faces fierce opposition from a number of business groups including those that represent landlords. They argue that LLCs must already share lots of information with the government and note that they will be required to disclose ownership to a branch of the U.S. Treasury Department by 2025.

The practice of operating business anonymously is prevalent in many California industries, proponents of the bill said. In Oakland, after city officials condemned a dilapidated building rented out to low-income immigrant families, the city attorney’s office spent more than a year investigating and combing through hundreds of city code enforcement records to find the owners of the building, said Suzie Dershowitz, who worked on the case at the time.

Others managed to dodge legal ramifications and responsibilities altogether through the practice, said Haley Ehlers of climate watchdog organization Climate First: Replacing Oil & Gas. The group has spent years advocating for the removal of orphan and idle wells left behind by defunct oil operations.

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