LONDON — The government proposed rules requiring foreign companies that buy property in the UK to disclose who owns them as part of a plan to curb money laundering.
The Department for Business, Energy and Industrial Strategy published a paper seeking views on the property register from real estate agents, lawyers and civil rights campaigners.
The register would be the first of its kind in the world.
The government said it was considering whether to “make it a criminal offence to fail to provide information to the new register” or fail to keep it up to date.
Once operational, the register could be used to identify oligarchs and corrupt foreign officials that use UK property as a store of value to hide the proceeds of criminal acts.
The UK and London real estate markets have become the destination for millions of pounds of laundered money from corrupt regimes.
Donald Toon, the director for economic crime at the National Crime Agency said: “Criminals and their money launderers will always seek to hide the true ownership of assets, including property, to frustrate investigations and hold onto the profits of their crimes.”
“Greater transparency over the true ownership and control of UK property held in the name of overseas companies will make the UK a less attractive place to launder money and will assist investigators track down and recover the proceeds of crime,” he said.
Since 2004, probes have identified more than £180 million of property in the UK “as the suspected proceeds of corruption, with 75% of those investigated using overseas companies to hide their real owners,” the BEIS said. “This is a tactic that investigators pursuing high level money laundering continue to encounter routinely.”
According to government figures, foreign companies own about 100,000 properties in England and Wales and with more than 44,000 in London. Public sector corruption siphons $US1.5 trillion to $US2 trillion annually from the global economy in bribes and costs far more in stunted economic growth, lost tax revenues and sustained poverty, the International Monetary Fund said last year.
Former Prime Minister David Cameron began the initiative last year saying that “some high-value properties, especially in London, are being bought by people overseas through anonymous shell companies using plundered or laundered cash.”
More from Business Insider UK:
- Brexit is set to damage Britain’s tourism industry
- The experts who got it wrong on Brexit think they have found a way to predict the next recession
- A high school principal quit after student journalists investigated her credentials
- PwC: ‘Fintech and financial services are competing less and coming together’
- After nearly 10 months of chaos the pound is finally returning to normal