Laundry basket set to shrink
The National Crime Agency (NCA) says that up to £90bn is laundered through the UK each year, which the Government is aiming to stop with the Criminal Finance Bill currently going through Parliament. Under the new laws, hundreds of British properties suspected of belonging to people who made their money through dubious, if not downright dishonest means, could be seized by enforcement agencies.
The Bill, which is designed to close a loophole that has left the authorities powerless to seize property from overseas criminals, will introduce the concept of “unexplained wealth orders”. With their new powers, the Serious Fraud Office (SFO), HM Revenue & Customs (HMRC) and other agencies will be able to apply to the High Court for an order forcing the owner of an asset to explain how they obtained the funds to purchase it.
The orders will apply to property and other assets worth more than £100,000. If the owner fails to demonstrate that a home or piece of jewellery was acquired using legal sources of income, agencies will be able to seize it.
When the Panama Papers scandal first hit, forensic investigations revealed many hitherto hidden secrets, particularly amongst non-domiciled foreign residents, who claimed they were complying with the laws in their own country. Under the new powers, these investigations should become easier, as targeted individuals need not be resident in the UK, as they do now. The law will also apply to property acquired before it is introduced.
Forensic investigations are all about finding out who owns what and how they acquired the money to buy it, so there could be a reduction in the amount of money laundered in the UK in the future.
Author: Roger Isaacs, 25 November 2016