Countering Russian Aggression and Tackling Illicit Finance — House of Commons, 2022-02-23
Topic: International Affairs
Alison Emily Thewliss (Scottish National Party, Centre-left): The hon. Gentleman is absolutely correct on that. There is a real need to work together on this, but the UK has been several steps behind, unfortunately I note with interest that it was reported that shares in Russia’s two biggest banks went up yesterday, in relief that they had not been targeted. The five banks targeted represent a mere fraction of the Russian banking sector. Only one of the five is on the Russian central bank’s list of systemically important credit institutions. The Black Sea bank is Russia’s 197th largest bank by assets, IS bank is 155th and GenBank is 92nd. They were hardly the biggest fish to go after. Ministers have assured us that there will be a ratchet process, but it feels to many that they are not moving fast enough or taking enough action to make a real impact here. Those cronies and oligarchs who have money to shift will no doubt be doing so already. The Minister of Foreign Affairs of Ukraine, Dmytro Kuleba, has tweeted this morning: "To stop Putin from further aggression, we call on partners to impose more sanctions on Russia now. First decisive steps were taken yesterday, and we are grateful for them. Now the pressure needs to step up to stop Putin. Hit his economy and cronies. Hit more. Hit hard. Hit now." The UK Government should listen to that plea from our allies There was much talk during the recent statements of military action and of sending tanks and guns, and while that might be of immediate assistance in an escalating scenario with tens of thousands of Russian troops on the march, we must not neglect to tackle the long-standing scandal on the doorstep of this Parliament that has allowed President Putin to gather his strength and finance his corrupt regime. What frustrates me, other colleagues across this House, anti-corruption experts in the field and the Glasgow Central constituents who email me is the lack of action and urgency on illicit finance. The UK Government alone have this responsibility, but they have not taken the ample opportunities they have had over the years to stop the flow of Russian dirty money through the City of London. The Minister for Security and Borders, the right hon. Member for East Hampshire (Damian Hinds) told the Treasury Committee that he was not happy, and we are not happy either. The Government could have taken stronger measures in the Sanctions and Anti-Money Laundering Bill Committee, on which I sat. They did not do so. They have their registration of overseas entities Bill, which is still waiting for action. They have had ample opportunity to reform Companies House and to tackle Scottish limited partnerships and the lack of investment in enforcement agencies. People are getting away with this corruption through a lack of proper enforcement One of the most egregious examples is the Russian laundromat case, in which some 113 Scottish limited partnerships played critical roles in a massive Russian money-laundering scheme that moved $20.8 billion out of Russian banks. One of those involved was Igor Putin, cousin to the Russian president. I would like to pay tribute to my former colleague in this House, Roger Mullin, who did so much to tackle the scourge of the misuse of SLPs, along with the researcher Richard Smith and the journalist David Leask. The UK Government’s actions to tackle that were painfully slow and they have still not nailed the issue of the abuse of SLPs or the lack of enforcement on persons of significant control. Money has been taken from Ukraine recently via SLPs as well. Some £36 million in a scam being investigated by authorities last year ended up in the bank account of the SLP Remini Consulting Let us not kid ourselves: this is profitable business. The lack of enforcement has allowed an industry to flourish unchecked in the leagues of enablers right here in the UK. The journalist David Leask has pointed out: "The mundane, unhappy reality is that we have outright crooks and a fair number of white-collar professionals happy not to look too closely at where money comes from. These ‘enablers’ here"— in Scotland— "and in England are a threat to the UK and to the wider world. They corrode our democracy and distort our markets. And they are laced throughout our society. They are company formation specialists, corporate lawyers and accountants who provide financial services to oligarchs, gangsters and corrupt politicians. They rarely think of themselves as bent. But that is what they are, ethically if not legally ." The UK Government cannot talk seriously about tackling illicit finance if they do not go after those who enable it. They ought to start by looking in their own coffers for the donations with dubious sources and for those whose funds allow them to come into the Government’s inner circle. The Conservative party has accepted nearly £2 million in donations of Russian-linked money since the Prime Minister came into office in 2019, with a quarter of the Cabinet reportedly having Russian-linked donations. The Prime Minister and the Minister said that these were legitimate donations from British citizens, but handing them golden visas first, before getting the money, completely undermines the whole principle. I have constituents who have waited years for a visa, but anyone with enough money can waltz right in and do what they like.