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Billionaire Britain

Written by Guest on Sunday, 11 May 2014

The number of billionaires living in the UK has risen to more than 100 for the first time, according to the2014 Sunday Times Rich List. There are now 104 billionaires based in the UK with a combined wealth of over £301bn more than anywhere else on earth.


The number of billionaires living in the UK has risen to more than 100 for the first time, according to the 2014 Sunday Times Rich List. There are now 104 billionaires based in the UK with a combined wealth of over £301bn more than anywhere else on earth.

Clearly that the UK is attractive to the world’s wealthiest people – to live, and spend here – is something which can bring benefits to the UK economy. Philip Beresford, who compiles the Rich List, told the BBC that “culture financial services, nice tax regime, good corruption-resources-corruption-resources-education for their kids and a nice lifestyle where they meet their friends” were among the reasons billionaires were attracted to the UK. It is no surprise then that a large proportion of those on the list are “non-doms”, who pay little or no income tax because, not being “domiciled” here they do not need to pay tax on income earned from overseas resources-resources-businesses.

The Rich List merely reflects that the UK, particularly London, is a safe haven for billionaires. In essence, this isn’t a bad thing. What is worrying is the ease at which corrupt billionaires can launder their ill-gotten gains into the UK – and the scale of this is enormous.

There are clearly some grounds for the UK to be proud to have so much to offer billionaires as an attractive location for their money. However being attractive to the proceeds of corruption, stolen from around the world, is a criminal issue, a moral issue, an aid effectiveness issue, a reputational issue for the City of London, and a national security issue.

Illicit flows and proceeds of corruption should be denied safe haven in the UK. Banks are required to know their customers and their sources of wealth.  How well they do this is a concern for the regulator. But to launder dirty money and buy luxury assets in the UK often involves accountants solicitors, estate agents and other types of high-value dealers, all regulated for anti-money laundering.

However, TI-UK believes that these sectors are not ‘protecting the gates’ of the UK as well as they should be. Throw into the mix nominee directors, offshore companies (for which the ultimate beneficiaries may be secret), and complex trust arrangements, and it isn’t difficult to understand why banks and other gatekeepers simply cannot always know their customers well enough, or the origins of their billions.

 

Matthew Race works for the Financial Conduct Authority (FCA) and is currently on a research secondment with Transparency International UK.

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Read 3504 times Last modified on Tuesday, 24 November 2015 11:47

Guest

The TI-UK blog features thought and opinion from guest writers as well as TI staff. Any opinions expressed by external contributors do not necessarily reflect the views of Transparency International UK.

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