Corporate Transparency and Economic Crime — House of Commons, 2022-02-28
Topic: Domestic Commerce
Kwasi Alfred Addo Kwarteng (Conservative, Centre-right): With your permission, Mr Speaker, I would like to make a statement on the reforms the Government will be bringing forward to improve transparency over the ownership of companies and property in the UK, and to strengthen the enforcement of financial sanctions. These are the key elements of our strategy to tackle dirty money from Russia and elsewhere The openness of our economy to investment from all parts of the world is one of our greatest strengths. However, we are determined that we want to attract the right kind of investment. As many Members will know, oligarchs and kleptocrats from Russia and elsewhere have used the veneer of legitimacy provided by UK registered companies and partnerships, and have used high-end property to help launder proceeds of corruption. At present, Companies House has very limited powers to prevent that abuse. In light of Russia’s outrageous actions in recent days, it is necessary that we put those criminals on notice and send a clear message that the UK will not tolerate their corruption here. To that end, I am announcing two immediate steps First, the Department for Business, Energy and Industrial Strategy is today publishing a White Paper on corporate transparency and register reform. The White Paper sets out a comprehensive package of reforms to Companies House. [Interruption.] Stop pre-empting. Just be patient. The agency will be transformed into a custodian of accurate and detailed information, ensuring that we can clamp down on those who seek to abuse UK corporate structures to launder money. Anyone setting up, running, owning or controlling a company in the UK will need to verify their identity with Companies House, which will then be able to challenge dubious information and inform the security agencies. Company agents from overseas will no longer be able to create companies in the UK on behalf of foreign criminals or secretive oligarchs. The reforms will not only tackle illicit finance, but directly support the millions of legitimate enterprises which transact with Companies House every day. Alongside the White Paper, we will be legislating for other measures, including reform of limited partnerships law, new powers to seize crypto-assets, and reforms to help businesses share information on suspected money laundering Secondly, we will be introducing legislation to Parliament tomorrow to accelerate other measures that will make an immediate dissuasive effect on dirty money and its purveyors from Russia and elsewhere. The Bill we introduce tomorrow will create a register of overseas entities to crack down on foreign criminals using UK property to launder their money. The new register will require anonymous foreign owners to reveal their real identity to ensure that criminals can no longer hold property behind secretive chains of shell companies. By legislating now, we will send a clear warning to those who have used, or who are thinking about using, the UK property market to launder ill-gotten gains, particularly those linked to the Putin regime. Tomorrow’s Bill will reform unexplained wealth orders, removing key barriers to their use by law enforcement. It will also include amendments to financial sanctions legislation, helping to deter and prevent breaches of sanctions. The new property register and the reforms to Companies House will once more see the UK take innovative and world-leading steps to tackle anonymous shell companies. We have been leading on this agenda since being the first major economy to put in place a public register of beneficial ownership for all domestic companies in 2016. Not only can we pay tribute to the heroic efforts of the people of the Ukraine—Ukraine—to defend their democracy and their freedom; these measures, in a small but significant way, will put pressure on kleptocrats and oligarchs who have abused our hospitality for their own nefarious purposes.