The media hardly noticed a shocking revelation about the ‘scale of money laundering’ in the UK

City of London - money laundering in the UK
Mohamed Elmaazi

The Home Office made a startling admission regarding the amount of money laundering in the UK recently. But the mainstream press appears to have missed it.

On 29 January, minister Ben Wallace said that the National Crime Agency (NCA):

estimates that there is a realistic possibility that the scale of money laundering impacting on the UK annually is at least in the tens of billions of pounds.

But historian Mark Curtis didn’t miss it:

Deliberate policy?

Andrew Feinstein, CEO of Corruption Watch UK, told The Canary:

The UK has been amongst the biggest centres for money laundering since the deregulation of the City of London in the 1980s. This is a consequence of the largely unregulated financial sector and the myriad enablers and facilitators of corruption and money laundering, including the large audit firms, legal firms and consultants.

The Canary asked Feinstein about the government’s “ambitious new partnership to fight economic crime” called the National Economic Crime Centre. The campaigner and former politician said:

I have no faith in this government meaningfully tackling this problem as these facilitators and enablers are amongst their biggest political donors. Attempts to streamline legal enforcement on this issue have been characterised by illogical decisions and appalling implementation.

He continued:

This will be made worse by a post Brexit environment in which the government envisages the UK becoming an even less regulated offshore haven. There is simply no political will to address the issue, as a consequence of which Britain will, if anything, become an even greater enabler of global corruption and money laundering.

‘Many hundreds of billions’

In October 2015, the NCA website said it:

assesses that many hundreds of billions of pounds of international criminal money is laundered through UK banks, including their subsidiaries, each year.

So if anything, the Home Office may have vastly understated the amount of illegal funds cleansed through the City of London. From “many hundreds of billions” to ‘at least tens of billions’. Yet the Conservative chancellor Philip Hammond recently praised The City for its contribution to the country:

Tax Evasion and Money Laundering

In January 2013, a European Parliament select committee published a report on the link between tax evasion and money laundering. The report said:

tax evasion provides incentives to established financial institutions as well as authorities or politicians to engage in corrupt activities, in quest of their own enrichment or other benefit. Financial institutions/banks are interested in increasing their profits by making use of this stream of funds, even if that implies circumventing the existing rules.

By design

This means that the mechanisms financial institutions and accountants create to evade tax are inevitably used to facilitate money laundering. This is made worse by countries ‘racing to the bottom’ to offer ever lower corporate tax rates.

The UK corporate tax rate is currently 19%, the lowest on record, down 33 percentage points from the peak rate of 52% in 1982. The rate is set to drop to 17% in 2020.

These latest figures show money laundering is a massive problem. Surely it’s time for people to come together and tackle systemic corruption once and for all.

Featured image via Wikimedia Commons/Christoph Braun

Get involved

  • Learn more about major corruption in the UK.
  • Also see the work of Tax Justice advocate in the UK.
  • Write to your MP and demand they take action on large scale tax evasion and money laundering (always be concise, specific and respectful to be effective)

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  • Show Comments
    1. Y is UK the den for stashing and laundering money ? That is like saying Y is London,a International Finance and Banking Centre ?

      Part 1

      Firstly,London has an exceptional legal and judicial system with specialised laws, specialised courts and specialised judges for economic,commercial and financial misdemeanours and crimes.What that means is that tax evasion and bank fraud,is not a crine,under FATF and Brit laws,UNLESS it qualifies as a crime,in British Common Law. dindooohindoo

      Step 1

      Take the pathetic state,of the Indian Legal and Judicial system,and the PANDOO POLICE.The word Pandoo,is a Dog in Khaki,on an invisible leash,held by Politicians (who are pruned by the Tycoons).Unlike Dogs,who listen to sonic whistles – the Pandoos react only, when they SEE or HEAR money.So,if the Pandoo Police mismanages the case,or destroys evidence,there is nothing that the Indian Judiciary can do – especially the lower judiciary (which is inept)

      As per a SC Ex-Judge,the entire Indian Judiciary,is CORRUPT and HE ALSO SAYS THAT,CONVICTS CANNOT GET A FAIR TRIAL IN INDIA ! This Ex-SC Judge is DEFEMDING a man in the Crown Court who is on the Interpol RCN list.

      https://timesofindia.indiatimes.com/business/india-business/ex-sc-judge-claims-in-uk-court-nirav-will-be-denied-a-fair-trial-in-india-says-his-case-has-been-politicised/articleshow/ 78003748.cms

      So for a tycoon in London,to prove that he was framed,by an inept police and judiciary,and a worthless legal system,is easy money.For the Crown Court,to be convinced of these arguments,is easy,

      Step 2

      The credibility of the Indian Investigators,is the PITS.They reek of corruption and political bias,and witch-hunting.They are all worthless,and have been excoriated and lampooned,in the media and UN reports.For the Crown Court,to be convinced of these arguments,is easy.

      Step 3

      Take the case of Nirav Modi.What is the Diamond Business in India ? It is Pure money laundering.WHy is this Bania being targettted – he says ? Ok – so his company diverted funds,submitted forged Invoices/AWB/Test Reports,They used the Bank SWIFT Codes etc.,BUT THE CATCH IS – Y did the Auditors,Bank Management and the RBI INSPECTIONS,NOT DETECT IT ? Cheating and Fraud,is a part of the Jewellery business,and the GOI was pushing this business, to BRING IN THE USD – and SO,the systen ENCOURAGED THE SAME.

      Then,Mr Modi sayeth,that Y did his OWN AUDITORS not DETECT THE FRAUD ? So the final plea is, I DID NOT KNOW – as all financial matters,are handled by the CFO and the MD.

      So for a tycoon in London,to prove that he was framed,by an inept police and judiciary,and a worthless legal system,is easy money.For the Crown Court,to be convinced of these arguments,is NOT TOO DIFFICULT.

      Step 4

      UK is a signatory to all the Protocols of the UN – ICCPR,ICESCR,CERD,CAT etc.So to PROVE in a Crown Court,that the Indian Pandoo Police are scum,and torture is rampant,and the health and hygiene conditions,in Indian Jails,are pathetic – is easy – as it is documented by UNHRC,ECHR,Amnesty,and the Indian Media.

      SO THE TYCOON,GETS A UK RESIDENT VISA

      NEXT STAGE IS TO BRING IN THE STASHED LOOT,FROM OFFSHORE JURISDICTIONS.So long as you are NOT a terrorist – beneficial ownership of bearer shares,Trusts and Foundations,is not pierced,in UK.Hence,through a maze of Trusts,SPVs,Foundations and Corporations – the money enters the UK.From the UK,the money can be invested in any part,of the world – with 100% Capital and Revenue Guarantee.

      Step 5

      But this is the Gem of the UK.All the Global Business,Financial consultants and Economists of the world,are stationed in London,feeding off Consulting,Tax,Accounting and Incorporation services, for all the economkic and financial fraudsters,of the world STATIONED IN LONDON.THAT IS TAX,ON THE STASHED CASH – WHICH goes to the Private sector (and partly from them to the state).But it keeps London,as the Financial nerve centre – and MOST IMPORTANTLY,keeps the Property Market afloat.Brits have STOPPED manufacturing.If the Property prices,in London crash – it will be the biggest financial disaster for the world, and will completely destroy,the British Banking System – which is the ONLY,viable economic activity,in the UK.

      But the magic lies ahead.Then these Global Business,Financial consultants and Economists, advise Pakistan,India and other nations with persuasion and coercion,to do a Tax Amnesty or a OTS – in around,say 7-10 years.By that time the,launderers have washed the money, multiplied it at least 2 fold, AND THE BANKING SYSTEM AND CURRENCY RATE,IN THE TARGET NATION (Pakistan/India etc.),is busted – and so,the launderers GET THE BEST DEAL (with the advice of the Global Business,Financial consultants and Economists).

      TAKE THE EXAMPLE OF THE INDON-ASS-EAN TAX AMNESTY. Guess the Tax rate ? 2 to 10% ! GUESS WHO WERE THE ADVISERS TO THE INDON-ASS-EAN Government ? Guess the amount that came in ? USD 330 Billion – more than 1.5 times Pakistan’s GDP.

      And then,the MOST important,In London,a Pakistani Tycoon,can partake in the Tax Amnesty,of any nation.So let us say that Jakarta declares an amnesty.A Pakustani Tycoon has 100 Million USD of dirty cash,in Gold or Bearer Bonds.There is an Indon-Ass-ean in London,with a legit business.The Pakistani Tycoon himself,or with others has several food shops or stores or schools,running for the last 5 -10 years.So the Indon-ass-ean invests USD 98 Million in the Pakistani Businesses,and takes the USD 100 million in Gold (which goes into a sealed vault).HOW THE INDON-ASS-EAN GOT THE GOLD,IS OF NO CONCERN,TO THE INDON-ASS-EAN GOVTT.He raises a secured loan at close to 0.30%,and then,wires the cash,to BNI in Jakarta.

      The Pakistani tycoon has washed his money for 2%.The Indon-ass-eean has earned 2%,for doing nothing.Then the most DELICATE PART of the trade – is to move the money OUT of JAKARTA.What is the magic when 330 Billion USD comes in ? The Indonesian Rupiah appreciates by 10-20% ! SO WHEN THE INDON-ASS-EAAN TYCOON TAKES OUT THE CASH,FRON INDON RUPIAH,TO USD – HE HAS USD 120 MILLION – for which he and the Pakistani Tycoon,have already struck a NDF deal,WITH THE FINANCIAL EXPERTS in London !

      For taking the money OUT of JAKARTA – you need expert Consulting Counsel.When the Money comes back to London,the Gold goes back to the Tycoon (in tranches) as the Pakistani Tycoon,BUYS back the stake sold,to the Indon-ass-eean and the FX gains are SPLIT.

      LONG Before the TAX amnesty – you will see frentic activity,in Purchases of Indonesian Paper,and Deposits in Imdon-ass-eean Banks,in Indon Rupiah – which will be pulled out,when the YTM declines,and the Indon Rupiah RISES,due to the USD 330 Billion.

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