The government planning a register for offshore companies buying property in the UK that would require the companies to reveal who is behind them, according to the Times.
In effect, the register would mean secretive owners of luxury properties across the country would be unmasked, as they could no longer hide behind anonymous shell companies. This practice is not illegal but allows people to launder money and hide taxes by hiding their identities.
Corrupt Nigerian governor James Ibori, Saif Gaddafi, son of the Libyan dictator, and Rakhat Aliyev, the deputy head of Kazakhstan’s secret police accused of money laundering and murder, have all used offshore vehicles to buy homes in London, according to the Times. Last year the Metropolitan Police warned that £180 million worth of property owned by offshore vehicles has been put under investigation for money laundering over the past decade.
However, officials are debating whether to apply the new rules only to new companies buying property here or to cover all property owned through a shell company. If it is the former, around 100,000 shell companies that own huge amounts of property across the UK will remain anonymous.
Private Eye first exposed the staggering extent of offshore company ownership of British property last September, identifying at least £170 billion worth of property owned by offshore companies.
David Cameron is expected to announce the new register of ownership at the anti-corruption summit in London next month. The summit was called by the Prime Minister in a bid to repair his image, after it emerged that his father was named in the Panama Paper’s leak. Ian Cameron set up a trust in the tax haven, which the Prime Minister was at one point a shareholder of.
While a transparency register sounds good in theory, it will be interesting to see how exactly it is implemented. Last July, the Prime Minister said in a speech in Singapore:
I have asked the Land Registry to publish this autumn data on which foreign companies own which land and property titles in England and Wales. This will apply to around 100,000 titles held on the Land Register and will show for the first time the full set of titles owned by foreign companies.
However, the Land Registry only got around to publishing this data in March, 6 months after Private Eye made public effectively the same data.