Countering Russian Aggression and Tackling Illicit Finance — House of Commons, 2022-02-23
Topic: Law and Crime
Liam Dominic Byrne (Labour, Centre-left): I congratulate Labour Front Benchers on calling this debate, because we are required to come together today to discuss, to expose and to unravel what could be the greatest coincidence in British politics. The cynical would say, in the words of Yogi Berra, that it is almost too coincidental to be a coincidence, although of course this House would not hazard such a judgment, but here it is: on the one hand we have a Government who have presided over the most comprehensive failure to tackle economic crime, which is a failure so profound that we have earned a reputation around the world as one of the world’s capitals of money laundering, yet on the other hand we have a flood-tide of money—not £2 million, not £3 million but over £4 million, and counting—that has come into Tory party coffers from generous souls with close ties to Russia. The ministerial code, for what it is worth, says that Ministers are required not only to avoid a conflict of interest but to avoid an appearance of a conflict of interest I therefore speak today in a spirit of great generosity to the Minister, because I want to try to extract him from the pickle that he now finds himself in. I am seriously concerned that Tory Ministers are now exposed to the allegation that they are quite simply poodles on roubles. In that spirit of generosity, I want to set out the two problems that the Minister will be required to resolve if he is to escape such an appearance over the weeks, months and years to come. Problem No. 1 is the gaping hole where a plan for tackling economic crime should be. We know the scale of the problem because the National Crime Agency has told us. It says that the scale of economic crime is some £100 billion a year in money laundering and £190 billion lost to fraud—a total of £290 billion. That is a significant chunk of our nation’s GDP, so this is not an insignificant problem: it is a monumental problem over which the Government are presiding. Secondly, the reputational damage is so serious that think-tanks in Washington are writing reports saying things like: "uprooting Kremlin-linked oligarchs will be a challenge given the close ties between Russian money and the United Kingdom’s ruling Conservative Party" How on earth has the Conservative party got itself into this mess? Well, it is quite a story. I am going to rattle through the 10 key steps that have led the Government to get into this mess. First, they abolished the Minister in charge of economic crime. When the Minister was appointed—[Interruption.] Well, he was appointed with the title of Minister for Security and Borders, whereas his predecessor was known as the Minister for Security and Economic Crime. So the Government are taking economic crime so seriously that they deleted it from the title of the Minister who has been asked to wind up this debate Secondly, the Government have now tasked not one, not two but 12 different agencies with tackling the problem of economic crime without going to the trouble of appointing someone to be in charge of these 12 different agencies so as to lead the charge. Thirdly, they have neglected to implement 60% of the measures in their own economic crime plan. Going through the list of measures rated "red" by the Royal United Services Institute, some of them are pretty significant, such as making sure that the police get serious about tackling fraud and economic crime Next, the Government have starved the National Crime Agency of so many resources that its director general says that it will not take on cases where it thinks the legal costs will be too high. Then they have failed to equip Companies House with the powers to check information sent in by people setting up shell companies. According to the Minister, there are now 11,000 companies on the register that still have not filed returns on who is the person with significant control, yet how many prosecutions have we had? One hundred and nineteen. It is pathetic; it is lamentable. Then they have failed to bring forward a register of beneficial ownership of property, like the multi-million-pound mansions in Westminster. Then they have failed to use our unique role in the global financial economy to light up where bad actors are doing bad things. SWIFT, the financial messaging system, is based in the UK. We are the global hub, along with New York, of financial settlement worldwide. We could be using the panorama of information to which we have access to light up bad people, to create intelligence packages and then to ensure that those people are pursued to the ends of the earth We have failed to stop our courts being used as arenas to silence journalists such as Catherine Belton and Tom Burgis, who are pursuing bad and corrupt companies. Thank God for HarperCollins and Arabella Pike because, frankly, without such brave publishing houses, we would not have the truth brought into the public domain. Then we have the Government’s failure to introduce a foreign agents registration Act, despite the fact that it works in America and Australia. To cap it all, they have failed to offer us any kind of hard timetable for the economic crime Bill, which is an omission so serious that they lost their own Minister to it in the House of Lords Those 10 elements—this 10-step decent into chaos—is why we now have a situation where the grand total of unexplained wealth orders targeted against oligarchs is zero. Apart from the Magnitsky sanctions, which came from a list of the crimes handed to us in 2007, we have not proposed any sanctions for economic crime against Russian-born individuals since 2014. Some might say that is benign neglect; others might say it is malign neglect; and others might say that the Conservative party has been paid to look the other way I am sure we were all reassured by the Secretary of State for Instagram’s appearance on "BBC Breakfast" this morning, where she—the Foreign Secretary—told a grateful nation that the Tory party vets its donors and that we must not confuse Russian heritage with proximity to President Putin. I think we would all agree with that, which is why, in the spirit of generosity and helpfulness, I offer my vetting services to those on the Conservative Front Bench this afternoon Let us start with Lubov Chernukhin, who has donated £2.1 million. The Guardian revealed that her husband, Vladimir, who was appointed deputy chairman of VEB, which was not sanctioned yesterday, received $8 million from Suleiman Kerimov, who was sanctioned by the US Treasury in 2018. The transfer to Vladimir came on 29 April 2016, mysteriously just before a donation of £1.5 million to the Conservative party. Then there is Alexander Temerko, a man who, it is said, "forged a career at the top of the Russian arms industry and had connections at the highest levels of the Kremlin" He was a former deputy chairman of Yukos Oil Company and somehow mysteriously escaped the purge of his colleagues. He has now donated £747,000. He has been working very closely with Viktor Fedotov, a director of Aquind, a source of great largesse to many Members in the House. Mr Fedotov is the former head of a subsidiary of Lukoil, and was revealed in the Pandora papers as a man who, along with two others "made fortunes from the company in the mid-2000s, around the time it was alleged to have been siphoning funds from the Russian state pipeline monopoly Transneft." Then we have Dmitry Leus, who has donated £54,000. According to the Daily Mail, he was "found guilty of money laundering and jailed in Russia in 2004. The conviction was later overturned and he insists the prosecution was politically motivated." Here is the mystery: he also donated to the Prince’s Foundation, which has decided to return Mr Leus’s money. The House will be amazed to hear that the Conservative party has not Then we have Mohammed Amersi. He and his wife have given £793,000 to the Conservative party. The BBC said he was involved in one of Europe’s biggest corruption scandals, which entailed $220 million being paid to a Gibraltar-based company owned by the daughter of the President of Uzbekistan. He has always insisted that his donations came from UK profits, but the Financial Times tells us that he "received $4m from a company he knew to be secretly owned by a powerful Russian"— Putin’s then telecoms Minister Then we have Murtaza Lakhani, whose firm Mercantile & Maritime has donated £500,000. This is the chap who Bloomberg tells us has been revealed as making large parts of his fortune through channelling "a $6 billion torrent of cash" from the Russian oil giant Rosneft to Kurdistan. The money flowed to a company registered in the tax haven of Belize, with a mailing address in Cyprus Then we have David Burnside, formerly of this parish. His firm has donated £200,000. Mr Burnside boasts links to senior figures in the Kremlin. The Guardian reported that he "has introduced several prominent Kremlin figures to senior Conservatives", including Mr Putin’s old friend, Vasily Shestakov.