Large chunks of London Prime property owned by offshore trusts magnet for money launderers
Prime Minister David Cameron has warned that the UK “must not become a safe haven for corrupt money from around the world” after it was reveled over £120 billion of property is owned by offshore trust with the ultimate owners of the properties unknown.
The government is currently preparing a consultation on a new law that would prohibit anonymous trusts from owning property in the UK unless they reveal the identities of the beneficiaries. This may only apply to future transactions and leading organisations such as Transparency International and Global Witness are calling for this new law to be retrospective”
“What we would like to see is legislation that would apply both retrospectively and prospectively,” said Chido Dunn, senior campaigner at Global Witness. “Any solution that looks only at the future will mean a huge part of the problem gets left alone. The legislation needs to have teeth and not be subject to exceptions that could be exploited. We need to ensure that any dirty money that has ended up in the England and Wales property market will be found out and the assets returned to whoever they were stolen from.”
“By allowing dirty money to come into the UK property market, we are facilitating corruption overseas,” said Dunn. “It causes poverty and takes money away from essential services like education and health. It helps create global instability, which is bad for national security. Dirty money is also having an effect on property prices, making it less realistic for your average person to afford a home. There has been a property bubble [in London]; prices for a two-bed starter flat have gone up exponentially in the past five years and part of that bubble is down to dirty money coming in.”
If the new law were to be passed with stricter anti laundering rules implemented this could result in a large drop in London house prices.