Why oligarchs choose London for their dirty money

the british government is talking tough since the war in ukraine began it has imposed strong sanctions on russia, as well as on individuals with connections to the kremlin the

oligarchs

in

london

will have nowhere to hide

london

is a bath of russian

money

these are houses valued in dozens of millions of pounds so much that it even earned the nickname Londongrad the

oligarchs

came to London they bought luxury properties in some cases they bought football clubs there was a lot of

money

coming in from that part of the world and it's not just the Russian billionaires from all over the world and your money I love calling London home.

This is a wealth that goes beyond anyone's imagination. The problem is that not everything is clean. Britain is one of the best places in the world to launder

dirty

money. Why it's so easy to fasten your seatbelts and put yourself in the hands of a world-class shopping jetset wizard It may seem natural that the super-rich would want to live in the British capital, but Londongrad's rise was not a happy one. accident, it was a business model. This is a story that goes back to just after. the second world war in the 1950s britain was really trying to deal with a loss of empire and seeking a new role in the world in 1956 the suez canal crisis caused massive sales of sterling around the world in response the Bank of England encouraged a radical new type of market.

British banks began borrowing, not buying US dollars, to do business because they were trading in US currency. This avoided the Bank of England regulations, but since they hadn't actually bought the dollars, it also avoided the Americans and that led. to the development of what are called euro markets, which essentially means trading currencies of different types outside

their

home countries, britain had adopted offshore banking as mainstream, the development of offshore banking was a big point of inflection because banks generally do not like regulation and what the offshore market is. What it essentially allowed you to do was use jurisdictions that had lighter regulation and simply allowed more freedom when it came to moving capital around the world and storing it.

British banking had changed forever and by the 1960s business was booming. London had become the place to get around banking regulations and at the same time there were plenty of offshore territories in the UK, in fact Britain encouraged them to become corporate services and finance from the British Virgin Islands to Jersey in the 1980s. Britain had a network of overseas territories. and crown offices that helped customers hide

their

cash and no one seemed to care where the money came from. Grand Cayman's modern fame is as an offshore tax and banking haven; Then in 1991 the game really changed when the USSR fell.

Nationalized Soviet industries were sold at a fraction of their real value. A few shrewd businessmen became very rich very quickly. Britain saw an opportunity. It dates back to John Major and the 1990s. The main government introduced golden visas essentially if you were a wealthy foreigner and wanted residency in the UK, even if you didn't intend to spend all your time there it could pay a huge investment to To get that right, even at the time the plan had its critics, I find it quite surprising that someone would have laundered money or simply to buy a ticket to Britain but the bait worked investing a million or two was a small price to pay for a billionaire Russia's super rich flocked to make London their second home, Londongrad was born, much of the money that comes here is perfectly legal. but tens of billions of pounds are not, so how does Britain help hide

dirty

money?

If I were an oligarch and I wanted to launder money, I would probably hire a team, hire a wealth manager and they would suggest various structures I could put my wealth into. Basically, you would come up with a system that would diversify your money and make it virtually impossible for investigators to track that money. If the money can't be traced, no one can prove where. where it came from or see who the owner is, that's where shell companies come in, if one of them owns the money, it leaves no fingerprints and setting one up in Britain is easy;

You can register a company for as little as £12 in the UK and then use that company to maintain a bank account in Latvia or Switzerland Registering a company at the company's headquarters in London takes just 24 hours There are very few checks on the identity of a person when registering a company that is changing as we speak and there are supposedly verification procedures being introduced, but until now anyone could register a company, there was no need to present a passport or any personal identification, you could register online from abroad , it was not even necessary to be the owner of the company. company according to the world bank britain is one of the easiest places to set up a company is the uk the best place to set up a shell company would certainly put the uk in the top five let's say including the overseas territories because it is So it's easy to register a company here and in one part of the UK it's even simpler.

Scottish limited companies are a type of company that is only available in Scotland and have fewer reporting requirements than the rest of the UK. It is not necessary to present accounts. For example, if turnover is less than a certain amount, the company can be said to be involved in a business, but no record can be provided of what that business actually entails, but on closer inspection, the wealth Hidden in a shell company it still looks like wealth being placed in a property. a great way to disguise it and keep it safe excuse me for a second, interesting, it's an iceberg, it goes down as much as it goes up and it's there finishing building at this stage.

Arthur Dewan's activist group Clamp K runs kleptocrat tours of London showing people. mega mansions bought with dirty money 14 Walton Street, which is here just behind these olive trees, was the subject of the first unexplained wealth order to be brought to court by the NC. It is completely unfair that the ordinary British citizen, taxpayer and voter has to compete for a British house with this stolen foreign money. We know there are thousands of properties in this part of London that belong to these types of shell companies. This is how it can work. that you can buy a house through an offshore bank account in which the bank account may be the name of an offshore shell company that shell company could be owned by a trust somewhere else suddenly the house with all that money does not seem nothing at all is much of a trick to hide dirty money Russians who have been accused of corruption or having links to the Kremlin have bought property worth at least £1.5bn in Britain and they are not the only kleptocrats in the city, at the same time that real estate prices in the capital have risen to eye-watering levels, prices are actually going up.

They are being pushed up by wealthy buyers active in the market, it all means greater inequality and many of these houses are not even inhabited in properties worth an estimated £41 billion that are empty in London alone, that is more than the total value of all. Property in Liverpool This is a city with a housing crisis, but owning an empty house is not illegal, which makes it very difficult to see when it comes to dirty money. It is a challenge that Britain is finding difficult to take on. Talks with the UK are a good game. What is missing at the moment is sufficient support for the police, the national crime agency and other agencies investigating this.

Italy, the United States, some other European countries tend to invest a little bit more, you know, pound for pound. In anti-corruption efforts, so to speak, the British government spends just under £1 billion a year to combat financial crime. Money laundering costs the economy more than 100 times that amount, but weak law enforcement is not the only reason the UK has become a magnet for dirty money. It also has a name for cleaning up reputations and money for someone who has been involved in money laundering or deals involving tainted money. Reputation laundering is useful in a particular way and that is to hinder investigation by for example journalists or NGOs, we have seen oligarchs and other foreigners doing this in the UK, if an investigative journalist is investigating you, can fight back.

Several law and public relations firms have specialized in helping wealthy foreigners make themselves, in some cases, appear more confident than they might be. reality but since the russian invasion of ukraine the charm offensive has stalled the british government has promised to clamp down on money laundering and has sanctioned individual oligarchs how will britain manage without your money? actually not so bad rich russians can spend a lot while they are here but britain gets less from them than you might think in 2020 foreigners owned about 13 trillion pounds of british assets russia's share of that amount was only 0.16 a smaller proportion than Finland or South Korea I think there is a question about how much money coming from the Russians actually benefits the wider economy and the potential cost to Britain could be much higher.

Well, there is a huge amount at stake when it comes to London and dirty money because London is one of the largest financial centers in the world and it deals with being legitimate and being clean and being a place where sophisticated investors can come and Do business and get financing if the city is tainted with dirty money, ultimately that is bad for your reputation. Britain has had that reputation for years, but it took the war in Ukraine for it to change. their golden visas have been scrapped and part of a long-delayed economic crimes bill has been passed.

No criminal or kleptocrat will be able to hide behind a UK shell company again as Britain vows to clean up its act against all dirty money sanctions. against individual oligarchs are starting to bite, but it was never just about the Russians, a lot of Britain's dirty money comes from other parts of the world and if shady Russian money leaves behind dirty money from elsewhere, it could easily take its place. Firstly, will Britain be so keen to toughen up? about dirty money when it's not the Russians who are behind it. The UK government needs to show that there is political will to go after these oligarchs, not just the Russians, there are many oligarchs around the world and we simply have not seen that in the last 20 years in fact, we have actively encouraged that money to these shores and that must change if we are to have any effect.

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