Transparency International UK has welcomed commitments by ministers from British Overseas territories and the UK Government to tackle illicit finance, but warns that dialogue should not detract from taking meaningful action.

In a joint communiqué released on 12 May 2023 following meetings in London, the Heads of Overseas Territories committed to improving corporate transparency and tackling the use of offshore centres to hide and retain wealth gained through corruption and crime.

The commitments include:

  • Launching an annual Ministerial-level dialogue focused on tackling illicit finance.

  • The establishment of a technical working group on beneficial ownership transparency, which will share expertise in the implementation of publicly accessible registers of company ownership.

  • Continued action to enforce sanctions against Russia.

Duncan Hames, Director of Policy at Transparency International UK, said:  

“An annual dialogue on illicit finance is a welcome step which secures a place for this critical issue on a high-level agenda year-in, year-out. It needs to live up to the stated intention of ensuring a close collaboration in implementing leading practices in tackling illicit financial flows, and not instead become a forum for negotiations seeking to legitimise back-sliding away from past promises.

“The international response to Russian aggression in Ukraine has put a spotlight on how different financial centres may be used to evade sanctions or hide illicit wealth. It is hard to ignore that so many individuals now subject to sanctions have substantial assets and company portfolios in the UK and jurisdictions like the British Virgin Islands. This should drive closer cooperation between the UK Government and British overseas territories that finally delivers on the commitments they have made.”

Notes to editors:

In February 2022, analysis from Transparency International UK identified at least £1.5 billion worth of UK property owned by Russians accused of financial crime or with links to the Kremlin. Most of this property is held by secretive offshore companies, including Overseas Territories.

In November 2018, research from Transparency International UK reviewed the involvement of companies from the Overseas Territories in corruption and high-end money laundering.

Looking at 237 corruption cases from the previous 30 years, we identified 1,201 different companies registered in the UK’s Overseas Territories that aided gross abuses of entrusted power for private gain around the world. Over 90 per cent of these (1,107) were incorporated in the British Virgin Islands (BVI).

Of these 237 cases:

  • 213 involved companies incorporated in the BVI
  • 32 involved firms in the Cayman Islands
  • 10 involved companies in Bermuda