Have some London estate agents slipped up on their anti-money laundering checks?

Anti-corruption campaigner Transparency International is calling for the Government to hurry up legislation to create a register of owners of overseas companies used to buy UK property, after Ukranian gangsters were exposed using London property to launder dirty money.

The Government has previously said a beneficial ownership register of foreign companies that own or buy UK property will go live in early 2021, but there are now calls to make this sooner after  the BBC Panorama programme on Monday revealed a number of individuals named in an Italian police report into the ‘Odessa oil mafia’ have been able to hide their identities and anonymously channel wealth into seemingly legitimate assets, such as UK property.

Buying agent Henry Pryor said on Twitter following the programme that some estate agents may have been “a little slack” in their anti-money laundering.

Using data from the leaked Panama and Paradise Papers, Panorama found a number of individuals named in an Italian police report into the ‘Odessa oil mafia’ had used a complex network of companies based in the British Virgin Islands (BVI) – known as “The Rubicon Group” to hide their activities.

The leaks show a number of companies in the Rubicon Group have been controlled by Gennadiy Trukhanov, the Mayor of Odessa – Ukraine’s third largest city. Trukhanov – who denies any wrongdoing – is a named subject of a current investigation by Ukraine’s National Anti-Corruption Bureau.

Companies within the Rubicon Group have been used to purchase eight high-end London properties, according to the BBC investigation.

It is the secrecy afforded by the British Virgin Islands that has allowed these individuals with questionable sources of income to hide their identities and anonymously channel wealth into seemingly legitimate assets, such as UK property, Transparency International said.

Duncan Hames, director of policy at Transparency International UK, said: “This investigation further illustrates the extent to which the UK’s Overseas Territories and Crown Dependencies, are at the heart of a secretive financial system that offers a way for individuals to obscure their identities and sources of wealth. The BVI and other UK Overseas Territories are obliged to cooperate fully with any investigation the National Crime Agency decides to pursue.

“These jurisdictions are the Achilles heel of the UK’s defences against money laundering. The Government must not ignore the role of its overseas territories when committing to crack down on dirty money.”

One of the properties in the documentary was a flat inside the prestigious 199 Knightsbridge development.

Prime central London agents such as Knight Frank, Onslows, Harrods Estates and Croft International have all sold properties in this block. There is no suggestion that any of these agents have been involved with the individuals the documentary focused on.

EYE asked several PCL agents about their approach to anti-money laundering checks.

Only Knight Frank responded.

A spokesman said: “Knight Frank has comprehensive procedures in place and works with law enforcement agencies and HMRC to ensure that all necessary regulatory background and anti-money laundering checks are carried out in accordance with regulatory requirements.”

Previous research from Transparency International UK found £4.4bn worth of UK property bought with suspicious wealth, £762m of which is owned by individuals from Ukraine.

Across England and Wales there are more than 86,000 properties owned by companies based in secrecy havens with almost 40,000 in London.

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2 Comments

  1. Hillofwad71

    http://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/PNS/13617249.html

     

    This is  the  annual report of Panther Securities out today  where Andrew Perloff  always  finishes off with  a very entertaining  “Chairman’s Ramblings ” who gives his own personal take on Money Laundering

    Pretty impressive results too!

    Report
  2. Trevor Mealham

    PIE should get MP Kevin Hollinrake to comment. Kevin (founder of Hunters) is now the MP Chair for the APPG on Banking group.

    Kevin knows of the Lloyds-BSU and RBS-GRG ASSET STRIPPING that has/ is happening.

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