Thread by @ChrisHa33342711

How many people read this:
House of Commons
Foreign Affairs Committee
Moscow’s Gold: Russian
Corruption in the UK
Report, together with formal minutes
relating to the report
Ordered by the House of Commons
to be printed 15 May 2018

The Government responded robustly to the attack on Sergei Skripal & his daughter, Yulia, in Salisbury in March 2018.
But despite the strong rhetoric, President Putin & his allies have been able to continue “business as usual” by hiding @ laundering their corrupt assets in London.

These assets, on which the Kremlin can call at any time, both
directly & indirectly support President Putin’s campaign to subvert the international rules-based system, undermine our allies, and erode the mutually-reinforcing international networks that support UK foreign policy.

This has clear implications for our national security.
Turning a blind eye to London’s role in hiding the proceeds of Kremlin-connected corruption risks signalling that the UK is not serious about confronting the full spectrum of President Putin’s offensive measures.

We therefore call on the Government to sanction more Kremlin-connected
individuals, including by using the powers outlined in the Sanctions and Anti-Money Laundering Bill, once available, to sanction individuals responsible for gross human rights violations.

We also ask the Government to work with the EU, US and G7 to
tighten loopholes in the sanctions regime that allow Russia to issue new sovereign debt with the assistance of sanctioned entities such as VTB Bank.

The Government must show stronger political leadership in ending the flow of dirty money into the UK. This should include allocating sufficient resources and capacity to the relevant law enforcement agencies, and improving mechanisms for information sharing.

The scale of the problem and its implications for the UK’s security also demand
a greater response from the Overseas Territories and Crown Dependencies, through which some of this money enters the UK.

We therefore welcome the Government’s commitment to assist the Overseas Territories in establishing publicly accessible registers of beneficial ownership.

We urge the Government to do everything in its power
to enable the Overseas Territories to put these registers in place voluntarily, before the end of 2020, and to set out clear plans for supporting the economies of the Overseas Territories as they do so.

The UK’s role as a financial centre and G7 member gives it significant leverage in
seeking to counter the Kremlin’s aggressive behaviour. But reacting in an ad hoc way to the Kremlin’s behaviour has led to a disjointed approach.

The UK must set out a coherent & pro-active strategy on Russia, led by the Foreign & Commonwealth Office & co-ordinated across the whole of Government, that clearly links together the diplomatic, military & financial tools that the UK can use to counter Russian state
aggression.

According to the National Crime Agency, “many hundreds of billions of pounds of international criminal money is laundered through UK banks, including their subsidiaries, each year”.

Vladimir Ashurkov of the Anti-Corruption Foundation told us that
there have been some estimates of money coming from Russia to Britain
over the last 20 years—100 billion is probably a good number.

Tom Keatinge "we have had the welcome mat out to money—it has been financial investment as opposed to industrial investment over the past 20 yrs. We have had a regulatory stance that has welcomed that money—"

"-it is not something that we have been particularly concerned about, so why would we consider it a security risk?"

Witnesses told the Committee that the UK financial system was seen as an easy target for Kremlin-connected oligarchs seeking to hide assets in London and to launder money obtained through corrupt means in Russia.

Journalist Luke Harding: "there is a view that basically we—the UK—are suckers, & that you can take advantage of all the freedoms and legal protections you have here while stealing at home.
So you steal in a place of legal nihilism and you offshore in a place of legal solidity.

There is a direct relationship between the oligarchs’ wealth & the ability of Putin to execute his aggressive foreign policy & domestic agenda.
The contemporary oligarchs owe their wealth to the President & act ,in exchange, as a source of private finance for the Kremlin.

Anti-corruption campaigner Roman Borisovich described the relationship in similar terms:
They can all be measured with the same yardstick… They are not self-made businessmen in the American sense.
Everyone of them made money through a relationship with the Russian
Government…

That bond forces them to do all sorts of chores for Putin,whether visible or invisible. It might be donating $7M to the GOP in the year of the presidential election in the States, or supporting an anti-EU think tank in Germany.
They all do something; we just don’t see most of it.

They are agents of a rogue Russian criminal regime, not businessmen.
They are complicit in Putin’s countless crimes.
Their money is not truly theirs,it is Russia’s.
Their companies are not mere international corps, but the means to launder money and spread corruption & influence.

It is often in small-scale stuff, such as:
“Wouldn’t it be nice if you thought it was worthwhile donating some money
to this particular alternative media website or to that particular populist
politician?”

What they are trying to do is create the illusion that this is
individual activity rather than a part of a state campaign.

Mr Borisovich "You have a system that is built on exporting illegal wealth.
That system has become aggressive to its neighbours. It can become aggressive in going against multilateral—unilateralism. It is going against democracy.

It is undermining democratic processes in the US, the UK & in Europe.
It is totally emboldened by the fact that, unlike in the time of the cold war—in the Soviet era—people who are perceived to be new enemies are allowed
to access banks and all financial instruments of the west.

Their money is hidden somewhere in plain sight, somewhere here, and nothing is being done to them."

The use of London as a base for the corrupt assets of Kremlin-connected
individuals is now clearly linked to a wider Russian strategy and has implications for
our national security. Combating it should be a major UK foreign policy priority.

The assets stored and laundered in London both directly and indirectly support President Putin’s campaign to subvert the international rules-based system, undermine our allies, and erode the mutually-reinforcing international networks that support UK foreign policy.

The size of London’s financial markets and their importance to Russian
investors gives the UK considerable leverage over the Kremlin.

But turning a blind eye to London’s role in hiding the proceeds of Kremlin-connected corruption risks signalling that the UK is not serious about confronting the full spectrum of President Putin’s offensive measures.

The Government should work with the EU, and with the US, to prohibit the
purchase of bonds in which a sanctioned entity has acted as book runner. It should also seek EU agreement to bar the European clearing houses from making available Russian sovereign debt.

The delay in introducing legislation to establish a register of ownership for overseas companies that own property in the UK is regrettable. The legislation should be put in place as early as possible, ideally enabling the reg' to be established before the Gov’s target date 2021.

We call on the Government to review this timescale, with a view to expediting it or setting out in more detail why the process needs to take so long.

Britain has existing legislation—the Bribery Act, the Proceeds of Crime Act
and the recently introduced unexplained wealth orders—that, if there was
the political will to apply it in a consistent manner, would go a long way to
targeting and rooting out corruption.

There is a clear need for stronger political leadership to show
the Government’s commitment to ending the flow of dirty money into the UK.

This must be demonstrated by allocating sufficient resources and capacity to the relevant law enforcement agencies, and by ensuring that those running the agencies are able to draw on information from across Government departments.

The UK must set out a coherent & pro-active strategy on Russia, led by the
Foreign & Commonwealth Office & co-ordinated across the whole of Government,that clearly links together the diplomatic, military and financial tools that the UK can use to counter Russian state aggression.