UK could become ‘jurisdiction of choice’ for financial crime, warns MP
Research warns the UK property market is at risk of being flooded by ‘dirty money’ from thousands of unknown property owners.
The UK risks becoming the “jurisdiction of choice” for financial crime and corruption, an MP has warned, as McMafia star James Norton joined politicians and campaigners warning of its scale.
Dame Margaret Hodge said “every crook and every villain in the world uses the UK’s regulatory system to set up their companies” because of its “veneer of respectability”.
She was joined by Norton, who plays Alex in BBC drama McMafia, credited with shining a spotlight on the murky world of international crime.
The parliamentary event, co-hosted by Global Witness, also highlighted new research suggesting the property market is at risk of being flooded by “dirty money” from thousands of unknown property owners.
The research claims around 85,000 properties across the UK are “secretly owned” by companies incorporated in UK tax havens, including more than 10,000 alone in the London Borough of Westminster.
Campaigners are calling for a property register, aimed at lifting the shroud of secrecy, to be put in place sooner than the date the Government has earmarked for its implementation – 2021.
As we see in #McMafia it’s too easy for the criminal and corrupt to launder money through luxury property, hiding real ownership behind anonymous companies. Their favoured location? #London. See how many #secretproperties are in your borough: https://t.co/9l2DMG1jk6 pic.twitter.com/qDyjy9aABK— Global Witness (@Global_Witness) January 29, 2018
Dame Margaret told the gathering at Portcullis House: “I do think there is a danger that the UK has become the jurisdiction of choice for all financial crimes and corruption.”
Britain’s overseas territories are “at the heart of facilitating corruption”, she said, adding: “We should be leading by example, and waiting for the slowest snail to come forward will never change the world.
“It’s not just the property register, the whole of the way in which companies are structured and regulated and vetted here in the UK invites corruption, invites financial crime.
“We have such a weak regulatory framework that every crook and every villain in the world uses the UK regulatory system to set up their companies, because we’ve got this sort of veneer of respectability.”
.@margarethodge says that UK and its overseas territories have become the jurisdiction of choice for financial crimes and corruption - as demonstrated by #ParadisePapers and #PanamaPapers @taxinparliament pic.twitter.com/KjVl7KF8yg— Global Witness (@Global_Witness) January 29, 2018
Investigative journalist Misha Glenny, whose book inspired the TV series, said the main family was based in the UK capital “because London has become so important in the world of money laundering through the property market”.
Referencing Brexit, he said: “There has been a lot of talk obviously in this country over the last few years about taking back control.
“It astonishes me that half of Baker Street is owned by people who are unknown to us.
“Now it seems to me a way of taking back control much quicker, much more effectively and efficiently than all of the palaver that’s been going on since 2016, is to make sure that we know who owns property in the United Kingdom, pure and simple.”