LONDON: In an unprecedented move, the British government has drafted a legislation “Registration of Overseas Entities Bill UK” which would require foreign companies owning UK properties to reveal their real owners.
This legislation in draft form on the 23rd of July will see the enactment of the world’s first register of overseas entities’ beneficial ownership and comprises of a wide-ranging crackdown on criminals laundering their illicit wealth in the UK.
Currently, the views are being sought for the draft bill and the consultation period for it is set to close on 17th September 2018.
Consequently, this bill would make it easier for UK’s law enforcement agencies (LEAs) to seize criminal funds, whilst reducing chances for such elements to hide their ill-gotten wealth.
According to the legislation, individuals illegally profiting from properties they own in the UK would be jailed for five years.
And new data disclosed that around 75 percent of the UK’s property industry concurred the new register would lead to a rise in transparency and decrease chances for illegal activity.
The penalties include a ban on any foreign entity selling or leasing property without first publicly declaring its beneficial owner; an individual found to have committed this offence could face up to 5 years in jail and an unlimited fine.
And individuals who fail to register overseas entities when instructed face up two years in jail and an unlimited fine.
Also, people who knowingly try and deceive the register by providing false information face up 2 years in jail and an unlimited fine.
This means it would make it more difficult for Pakistani’s or any other foreign citizens to invest or launder their ill-gotten wealth in the UK.
UK’s business minister Richard Harrington commented: “The UK is known around the world for its open and dependable business environment and this reputation is maintained by keeping under review our required high standards.”
He added, “That is why we are introducing the world’s first public register which will expose the ultimate owners of overseas shell companies, giving authorities the information, they need to come down on criminals who launder their dirty money through the UK’s property market and to seize the proceeds of crime.”
UK’s government minister for Scotland Lord Duncan said “For too long criminals have been able to use the property industry as a front for investing dodgy funds, hiding dirty money and evading the law. This stops now.
Most people who invest in property across the UK do so fairly, and legitimately, but the UK government is clear that there is no longer any room for those that seek to exploit the system to hide.”
Over £2 billion of criminal assets have been retrieved under the Proceeds of Crime Act, while the government has recovered more than £3 billion extra since 2010 through recovery under additional powers.
The National Crime Agency (NCA) in May had warned that the United Kingdom (UK) remains a prime destination for foreign corrupt and politically exposed people to launder money, with the biggest sources of corrupt investment being Russia, Nigeria and Pakistan.
In its annual assessment of serious and organised crime, the NCA said, “Investment in UK property, particularly in London, continues to be an attractive mechanism to launder funds.”
The agency had prepared a report drawing intelligence from UK law enforcement, government departments, the intelligence community and the private and voluntary sectors.
The report said, “Money laundering potentially running to hundreds of billions of pounds impacts the UK annually, with a significant threat being posed by the criminal exploitation of accounting and legal professionals involved with trust and company provision.”
It’s understood that hundreds of Pakistanis have invested money in the UK, unknown to authorities in Pakistan. Leaders from almost every major political party have invested monies across the UK, mainly from PPP, PMLN and PTI.
