Article: Will ‘Global Britain’ clamp down on money laundering?

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Will ‘Global Britain’ clamp down on money laundering?

Tom Burgis, 28 April 2021

In March 2014, a few days after Vladimir Putin’s forces invaded Crimea, a British official arriving for a meeting of the UK’s National Security Council failed to shield his notes from the Downing Street photographers. Any response to the Kremlin’s aggression should not, the notes read, “close London’s financial centre to Russians”. The government subsequently explained that it “wanted to target action against Moscow and not damage British interests”.

Seven years on, the assessment is very different. Last year’s report on Russia by parliament’s Intelligence and Security Committee — eventually published after a contentious delay — found that the warm British welcome for Russian money “offered ideal mechanisms by which illicit finance could be recycled through what has been referred to as the London ‘laundromat’”.

It went on: “Russian influence in the UK is ‘the new normal’, and there are a lot of Russians with very close links to Putin who are well integrated into the UK business and social scene, and accepted because of their wealth. This level of integration — in ‘Londongrad’ in particular — means that any measures now being taken by the government are not preventative but rather constitute damage limitation.”

This London laundromat serves all comers: corrupt wealth from countries ranging from Brazil to Nigeria to Malaysia has been found in the UK, prosecutors say. That has raised concerns about the influence that money can buy once it arrives. As the battle lines between democracies and authoritarian kleptocracies sharpen, anti-corruption campaigners are asking which side “Global Britain” — the reimagined country emerging from Brexit — will choose in that struggle.

There has been enthusiasm among some senior British business figures and parts of the ruling Conservative party for using the UK’s departure from the EU as an opportunity to relax the oversight of finance. Martin Sorrell, once the highest-paid FTSE 100 boss, declared in 2019 that he hoped to see a “Singapore on steroids . . . a regulation-light, tax-light UK economy, open for business in a way we haven’t seen before”.

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