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UK finally confronts the Russian cash cow

From sanctions against oligarchs to the end of “golden visas”, the Russian invasion of Ukraine has prompted the UK to tackle a system that has courted Russian money for decades – sometimes of dubious origin.

“It’s the end of an era,” Dominic Grieve, a lawyer and former Conservative MP who served as Attorney General under Prime Minister David Cameron, told AFP.

Grieve denounced London’s complacency over the origin of huge sums of Russian money invested in the country in a 2020 report.

Anti-money laundering activists have highlighted the role of London’s vast financial sector and its armies of lawyers, accountants and brokers in bringing in Russian dirty money.

They also accused the conservative government of hypocrisy and a lack of urgency in addressing the issue, with hostilities in Ukraine eventually pushing it into action.

The influx of wealthy Russian The Vanir-exoduss to the UK increased from 2008 with the introduction of so-called “golden visas,” which were granted in return for investments worth millions of pounds, Grieve explains.

“As a result, London and the United Kingdom more generally became an absolute magnet for Russian businessmen, who made a lot of money from the breakup of the old Soviet Union, often, one must say, in very dubious circumstances.”

– ‘There is still more to be done’ –

They found the UK “a pleasant place to do business, a pleasant place to invest and in many cases a very pleasant place to live and indeed raise their children”, he added.

“It was clear that many of these people have very close ties to the Russian state.”

The anti-corruption pressure group Transparency International has identified £1.5bn (€1.8bn) of London property owned by Russians accused of corruption or ties to the Kremlin.

It also identified more than 2,000 companies registered in the UK or its overseas territories that have been used in money laundering or corruption cases involving £82 billion in Russian money.

Transparency International pointed to the complicity – unknowingly or not – of British banks, law firms and accountancy firms.

London announced last month that it would stop issuing “golden visas”, expanding its list of people targeted by sanctions to about 15 Russians close to Vladimir Putin’s government.

Prime Minister Boris Johnson promised on Monday that “more needs to be done” on individual sanctions.

And a bill introduced in parliament also aims to prevent the use of property to launder money by disclosing the owner’s real identity, preventing them from “hiding” behind a company.

– The oligarchs serve –

The City of London will be “hit hard” by the asset freeze and travel bans on oligarchs, but will hold out as “the UK attracts money investment from around the world and people willing to invest,” Grieve said.

The UK’s financial sector was already subject to laws designed to control the flow of black money, but these were poorly enforced, in part due to a lack of resources in the government’s financial crime departments.

“The new package of measures has the potential to be very effective”, especially in “shedding light on the owner of nearly 90,000 properties in the UK that are owned by secretive foreign companies,” said Ben Cowdock, head of the investigations at Transparency International in the United Kingdom. UK.

But the measures must have “sufficient resources for effective implementation,” he added.

While fortunes invested in the UK come largely from Russia, others also come from the likes of Ukraine, China and Nigeria, according to a 2019 report by Transparency International.

“Britain has been committed to serving the world’s richest people and businesses since the end of the Empire, and if some of them are Russian, they’re great,” said Oliver Bullough, the author of a book on this subject. topic.

“If they’re from somewhere else, great,” added Bullough, whose book “Butler to the World: How Britain Became the Servant of Tycoons, Tax Dodgers, Kleptocrats and Criminals” is out next week.

Despite recent action, “people don’t seem to realize that we shouldn’t have money from oligarchs,” he added.

“There is no real enforcement. So at the moment it’s very disappointing.”

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