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London - city of culture, sport, finance and…money launderers

  • United Kingdom
  • Fraud and financial crime
  • Litigation and dispute management

04-04-2018

The House of Commons Treasury Committee has launched an inquiry into money laundering and economic crime. In launching the inquiry, Nicky Morgan MP (Chair of the Treasury Committee), referred to the London property market as becoming a “destination of choice” for money launderers. The inquiry will seek to assess the effectiveness of the regimes designed to protect the financial system, and in turn consumers, from misuse.

The reality and scale of the problem of money laundering is beginning to filter through into the public consciousness as statistic after statistic is published on the amount of UK property acquired with suspicious wealth. £4.4 billion is the estimate cited by the Treasury Committee as the value of UK property which may have been purchased with criminal proceeds. No longer is this seen as a victimless crime. However, prosecutions for money laundering are rare, particularly for breaches of money laundering regulatory requirements.

The Treasury Committee inquiry will have two strands: one focusing on money laundering and sanctions; the second scrutinising the scale and nature of economic crime faced by consumers. Cryptocurrencies, and the money laundering risk they present, are likely to feature heavily in relation to the first strand of the inquiry. As with all new technology there is a lag as law enforcement seeks to catch up with criminals intent on exploiting this anonymity-favouring flow of funds.

The second strand of the inquiry will consider the effectiveness of financial institutions in combatting economic crime as well as the security of consumer’s data. As reports of large scale data breaches become more common, the focus on data security will be a welcome one for consumers. The inquiry will also consider the threat posed to consumers by fraudulent activity online.

The Treasury Committee has asked for written evidence to be submitted by 8 May 2018 and witnesses for oral evidence sessions will be announced in due course.

With the money laundering-fighting inter-governmental body, the Financial Action Task Force, currently conducting a review of UK anti-money laundering systems, money laundering looks set to remain an agenda-topping item.

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