Targeting oligarchs – ‘scratching the tip of an iceberg’

By TruePublica: One thing that will not surprise you is the sheer scale of money laundering that the City of London’s laundromat is responsible for. It’s a colossal amount of money and far more than people imagine.

Various organisations have been reporting this level of crime for years. TruePublica is one of them. For a reality check, here are a couple of facts to know. Firstly, the average price of a property sold in London last month was £526,561. And one billion pounds buys an oligarch 1,900 average-priced properties in London for his portfolio to hide his/her wealth.

Next, the City of London launders over £100 billion a year.

Transparency International has calculated that oligarchs have between them, a property portfolio valued at something like £6.7 billion. That would be the equivalent to 12,730 properties at average London prices. Of course, it’s impossible to know how much oligarchs have invested in the UK because their investments are often hidden in Britain’s other great ‘services’ skill – the off-shore tax haven. Therefore, any estimate is literally a guess. The suspicion is that it’s considerably greater. And there is evidence to suggest that is the case.

One investigation found that of 2,189 companies registered in the UK and its Overseas Territories and Crown Dependencies used in 48 Russian money laundering and corruption cases – £82 billion was involved. These funds were tracked and linked to diverted monies by rigged procurement, bribery, embezzlement and the unlawful acquisition of state assets. And that was just one investigation.

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

“These figures highlight Britain’s continued role as a global hub for suspicious and illicit wealth, from Russia and elsewhere. We’ve found hundreds of properties together worth nearly £7 billion bought with suspect funds, but the sheer volume of assets held here by opaque offshore companies means this is certainly just the tip of the iceberg. Government plans to force overseas companies holding property here to reveal their owners are long overdue. Until the law is changed to do this, even those targeted by sanctions will continue to be able to hide their wealth here.”

However, the focus is on Russian oligarchs as they are the current bogeymen of the day. Truthfully, there’s a lot more to the story than that.

New analysis of hundreds of major corruption and associated money laundering cases also reveals how the UK continues to facilitate global corruption, not just from Russia and the former Soviet Union but other territories as well.

This analysis reveals a ‘Nexus’ of facilitators and corruption. These cases involved in this Nexus are defined as one or more of the following:

– The involvement of UK-based professional services, such as banks, law firms, and accountants.

– Money moving through UK-based companies.

– Money moving through shell companies in the UK’s Overseas Territories or Crown Dependencies

– Money invested in UK assets such as property.

In this analysis, it turns out that whilst Russia is the number one country on that list with 22 per cent of all cases within the UK nexus – that is then followed by: Ukraine 17 per cent, China 15 per cent, Nigeria 12 per cent, Azerbaijan 9 per cent, Kazakhstan 6 per cent, Indonesia 5 per cent, Eygpt 5 per cent, Brazil 4 per cent, and Uzbekistan 4 per cent.

The takeaway from this is that if the UK is awash with dirty stolen laundered cash from Russia, which amounts to 22 per cent of total illicit funding – wait until you add the rest of them, which when combined is four times greater than that of Russia.

Now ask, how many properties, shopping centres, landbanks, businesses and so on are there in the UK owned by sources of dirty money. And then ask – why do you think these people, who can settle, get citizenship for them and their families – would possibly want to influence political decision making in the UK. For decades, the UK has facilitated the theft of hundreds of billions from other countries and ensured that torturers, murderers, drug and human traffickers along with despots and dictators have been given safe harbour from justice. For just as long, successive governments have looked the other way. None are more guilty at the cash-for-influence/access scandal than the current incumbents in Downing Street.

For years the National Crime Agency (NCA) has made it quite plain – that “money laundering has the potential to threaten the UK’s national security, national prosperity and international reputation“. That statement has now been found to be fundamentally true.

 

It’s a system that keeps the crooked in power by the crooked.

 

So large is the money laundering caper in the City of London, the NCA warns that – “large volumes of criminal money flowing through the UK could result in criminal and regulatory penalties being imposed by UK, EU and US authorities. This could, in turn, lead to the withdrawal from the UK, or the potential collapse, of major financial institutions.” Make no mistake what the NCA is saying here – politicians have been aiding and abetting the very organisations that threaten Britain’s national security and its financial system.

Now that Russia has attacked a European country – crackdowns on Russian oligarchs has become really fashionable internationally. The various crackdowns have fuelled speculation about a potential collapse in London property prices. The Telegraph pointed out that the “influx of Russian money was at one stage so large it was said to have fueled a 36.5% rise in central London property prices in 2007”. That is nonsense, but it does show the media hysteria – that in itself helps to fuel property prices. There are 3.5 million households in London alone – so the exodus of Russian oligarchs is not likely to do anything to property prices of any consequence.

The question does remain though – why has the government not been hunting down these bankers and facilitators of the huge crime network in the City of London that facilitates the lifestyle of these criminals? The answer, as we already knew – but is becoming more public knowledge – both the bankers and oligarchs are, of course, political donors. It’s a system that keeps the crooked in power by the crooked.

Pushed out more widely, crime, in general, is truly eye-watering. In the first 11 months of 2020 alone, 2.5 million Suspicious Activity Reports were filed to The Financial Crimes Enforcement Network  (FinCEN), while more than 573,000 were filed to the National Crime Agency in 2019/20 in the United Kingdom. SARs are a critical intelligence resource for tackling money laundering, terrorism, serious and organised crime, corruption and fraud. The departments managing the caseloads are submerged. Not even 1 per cent are followed through to prosecution.

The result of all of this is simple. Anyone can launder money in the UK with ease, knowing the chances of being caught is remote. Whatever you are reading today about exposing the oligarch’s, dodgy dark-money operations, sanctions and so on – is not even scratching the tip of a very large iceberg.

 

 

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