On Monday, my On TAP was about the federal Corporate Transparency Act, and its potential to smoke out the hidden wealth of oligarchs, Russian and otherwise. Regulations to carry out the CTA have not been finalized yet, and one limitation is that it requires disclosure of beneficial ownership to regulators—but not to the public.

One good complement is the use of state and local laws requiring public disclosure of the true identities of oligarchs who often hide behind trusts and straws, especially when they park their wealth in super-luxury real estate that is often kept vacant. Philadelphia and D.C. both have local laws requiring disclosure of beneficial ownership. Statewide legislation was introduced in California last year to create a property registry disclosing beneficial owners, but was not enacted.

In New York, following protests in Rockland County about shell companies buying up properties in bulk, the legislature passed a law in 2019 requiring disclosure of true owners. The law caught the real estate lobby off guard, and it was quickly watered down to exempt condos (which are often used to park hidden wealth in New York City and provide a lucrative market for developers).

Ideally, state and local legislation on beneficial ownership of real estate should be part of a suite of laws that includes not just disclosure, but transfer taxes on very expensive properties, extra taxes on mansions, and penalties for keeping units vacant. Efforts on these fronts are proceeding in several places, including San Francisco, L.A., San Jose, New York, Connecticut, New Jersey, and Vermont.

Housing inflation and the scarcity of affordable rental units and owner-occupied homes is a national scandal. It will be remedied by measures addressed to failures and abuses in the housing sector, not by higher interest rates that will only worsen the shortage.

As our colleague Chuck Collins, a national leader in this reform effort, observes, real estate should be used to house people, not to hide wealth.