UK lawmakers are calling for a London crackdown on 'Russian corruption' in the interests of national security

  • The UK Foreign Affairs Committee have proposed measures that could tighten the sanctions regime against Russia and limit “dirty money” flows to London in the interests of “national security”.
  • The proposals, made in a report called “Moscow’s Gold: Russian Corruption in the UK”, called for a sanctions regime that combines the best practices of US and EU sanctions against Russia and would broaden the UK’s financial power in its foreign policy.
  • The Committee said there has been a gap between government rhetoric and action on Russia since the attack on the Skripals which should now be addressed.
  • This comes after the US has piled pressure on the EU to support it’s sanctions regime and warned European companies not to do business with targeted organisations and individuals in Russia.

Influential MP’s have called for measures which could tighten the sanctions regime against Russia and reduce flows of “dirty money” into London.

This morning the Foreign Affairs Select Committee published a report named “Moscow’s Gold: Russian Corruption in the UK“, which called for more coherent action from the government to clamp down on “dirty money” and tighten the sanctions regime against Russia in the interests of “national security.”

Since the fall of the Soviet Union in 1991 London has seen an influx of money from Russia through wealthy individuals and companies looking to store their wealth in the UK capital.

“The use of London as a base for the corrupt assets of Kremlin-connected individuals is now clearly linked to a wider Russian strategy and has implications for our national security. Combating it should be a major UK foreign policy priority,” the report said.

MP’s argued there was a gap between government rhetoric and action on Russia following the attack on the Skripal’s and proposed measures to further restrict the power Russia can wield through financial assets.

The committee chair and Conservative MP Tom Tugendhat said: “We can no longer allow ‘business as usual’. The UK must be clear that the corruption stemming from the Kremlin is no longer welcome in our markets and we will act.”

The report proposed more powerful sanctions which combine the “best practices” of both the US and EU regimes. It called on the Government to broaden its approach to sanctions by including individuals closely connected to hostile regimes and linking sanctions relief to specific actions desired by UK foreign policy.

As the UK Sanctions and Anti-money laundering Bill (2018) approaches the final stages of its passage through Parliament, the Foreign Affairs Committee explained that this is an opportunity to ensure sanctions remain an effective measure in the UK’s “foreign policy toolkit.”

The report comes after the US has piled pressure on the EU to support its sanctions regime and warned European companies not to do business with targeted organisations in Russia.Meanwhile Trump is pushing Merkel to drop support for the Nord Stream 2 pipeline which would increase energy ties between the EU and the Russian Federation.

The report came under some criticism when Ben Wallace MP, the security and economic crime minister, said the committee had not called him to give evidence while drafting it, adding, “I fear such an omission weakens the foundation of the report.”

The Russian Embassy in London told Business Insider: “We intend to study the report… What matters is that all corruption and illegal practices are investigated regardless of nationality and the relations of the countries of origin with UK, and without discrimination, and that honest businesses do not suffer due to their nationality.”

NOW WATCH: Money & Markets videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.