Friday, August 31, 2018

The Fiddlers

 Only three Unexplained Wealth Orders have been served in the six months since the instrument’s introduction.

 Five enforcement and investigation bodies – the National Crime Agency, HM Revenue & Customs, the Serious Fraud Office, Financial Conduct Authority and Crown Prosecution Service – were granted special powers to freeze assets and require the super rich to explain the origin of their wealth. So far only one, the National Crime Agency, has used them, and that was in relation to just one person, the wife of an allegedly corrupt banker.

This despite claims by ministers the new powers would see them mount a “full spectrum” assault on McMafia-type criminals and corrupt oligarchs. 

Ben Wallace, security minister, said in February: “When we get to you, we will come for you – your assets – and we will make the environment that you live in difficult.” 

In 1994 Gordon Brown, the then-shadow chancellor, announced a Labour administration would crack down on the use of loopholes to avoid tax. Two decades later, Britain still counts among its dependencies several of the world’s most aggressive tax havens, and we actively promote our appeal as a low taxation regime for wealthy foreigners, to encourage them to settle here.

The UK simply do not show the desire, commitment and purpose to pursue white-collar crime.  It has never given prosecutors tools regarded as standard in other jurisdictions. The City of London, too, is full of lawyers, accountants and financial advisers who specialise in defeating investigators and hiding wealth. To assist them, we have a hideously detailed tax code – more convoluted than that of India – which is full of get-outs and exclusions. And the UK has ready access to those vestiges of empire we continue to protect, and are now international boltholes for those seeking secrecy, or wishing to avoid tax.

Transparency International says it has identified £4.4bn worth of British properties linked to criminals or “politically exposed persons”. Hit them with UWOs and it’s easy to see the property market collapsing. So far, not even one of the three issued has been enacted. It faces legal challenges galore before it can begin to be enforced.
UWO is in danger of becoming the financial equivalent of that other no-show, the UFO.

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