Press release 08th Mar 2019

Parliament’s economic crime report – a call to act against dirty money entering the UK

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8th March 2019, London A new report published today by the Parliamentary Treasury Committee is a welcome move in bringing further scrutiny to the UK’s weak defences against dirty money, according to Transparency International UK.

The report draws much-needed attention to several areas of vulnerability in the UK’s approach to countering the threat of money laundering, including:

  • No verification of the UK’s Persons of Significant Control Register, allowing criminals to submit misleading company ownership information without penalty
  • A fragmented approach to money laundering supervision; resulting in parts of the private sector – the UK’s first line of defence – making a  poor effort in reporting these dirty money flows
  • Serious question marks over the effectiveness of HMRC as an anti-money laundering supervisor and its suitability for this role
  • The weak corporate liability laws that are failing to punish large corporates that commit serious economic crime

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

“We very much welcome the serious attention given by MPs to the flood of dirty money into the UK. The Committee’s report reinforces our own findings that the UK economy is vulnerable to abuse by corrupt individuals who have made it a key location in which to launder the proceeds of their crimes. MPs are right to point out that whilst the UK reveals publicly who owns UK companies, the data published in this register remains unverified and it is still too easy for criminals to submit false information.” 

“A key thread throughout this report is the fragmented nature of the UK’s anti-money laundering supervisory regime and it calls into question the effectiveness of HMRC in preventing businesses from turning a blind eye to dirty money. Any future review must be prepared to seriously overhaul what has been a major weakness in our response to dirty money. It’s absurd that in the property sector, where commissions on luxury homes can be in the tens of thousands of pounds, money laundering fines are typically only a fraction of that.”

“The call by these MPs to reform corporate liability laws chimes with a letter to the Prime Minister by another group of MPs this week calling for a new criminal offence to help get large corporates in the dock for economic crimes. The Government should join the growing consensus and at least task the Law Commission to investigate this with some urgency.

“As the UK prepares to leave the European Union, our exposure to new markets is both a risk and an opportunity. We cannot ignore corruption in these countries if we look to trade more with them, so the Government should ensure anti-corruption provisions are enshrined in all new trade deals.”