openDemocracyUK: Opinion

If the UK wants to push back against Russia, it should follow the money

Britain’s lax approach to dirty money makes it a target for Russian interference, but the government has done nothing about it. Now is the time to take action

Layla Moran
26 January 2022, 1.01pm
Russian President Vladimir Putin during a meeting in January 2022

Alexei Nikolsky/Russian Presidential Press and Information Office/TASS/Alamy Live News

The severity of the crisis currently playing out on the borders of Ukraine cannot be underestimated. This is the closest Europe has come to war in almost three decades.

At this moment of danger, it is vital that Britain plays its part and shows Putin that aggression comes at a high price – one not worth paying. But I am hugely concerned that, while our rhetoric might be tough, our actions are febrile.

It is not just worrying diplomatic missteps, like the foreign secretary’s decision to chase the sun in Australia rather than attend a vital meeting regarding the crisis in Berlin. The UK government has signalled time and again that it does not take Russian meddling in the UK seriously. If we do not take action to stop Putin from interfering in our country, how on earth are we meant to convince anyone that we will act robustly when he violates the integrity and sovereignty of other nations?

Successive reports from the foreign affairs and intelligence committees have warned of interference in the UK by Putin’s cronies. Successive Conservative governments have ignored them.

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The 2018 Foreign Affairs Committee report, ‘Moscow’s Gold’, warned: “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”.

Until ministers take action on this front, our response to Russian aggression towards Ukraine will be toothless. Yet what has the government done in response? Absolutely nothing.

Similarly, the Intelligence and Security Committee’s Russia Report, published in 2020, warns that there are “lots of Russians with very close links to Putin who are well integrated into the UK business and social scene”. Two years on not a single one of the recommendations made to the UK government have been implemented. Concerns about Russian interference extend into UK politics too – in particular, the well-documented close links between Russian money and the Conservative Party.

One easy way the UK government could take action to prevent Putin’s cronies meddling in our country would be to introduce legislation to ensure Kremlin-linked Russian oligarchs can’t flood dirty money into the UK property market. Buying a property in the UK is, as it turns out, an incredibly easy way to launder money. You don’t need to declare who the ultimate, or beneficial, owner of that property is. So if it’s one of Putin’s corrupt cronies, all they would need to do is set up a holding company, often in a tax haven, and appoint someone else as director. It has been estimated that more than £1bn of suspicious Russian wealth rests in UK property.

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The UK government does – in theory – admit this is not a sensible way to run things. Back in 2016, David Cameron promised to take action so that the ultimate owner of a property would have to declare who they were. But more than five years on, no such law exists. It hasn’t been introduced to Parliament. In 2018, the government took a draft version of this bill through the advance scrutiny stages that often take place before legislation is formally passed through Parliament. But these efforts went no further. The draft bill remains on the shelf, gathering dust. The UK government could sort this out in a matter of weeks, if not days, if it wanted to.

The government won’t take action to stop Russian interference in the UK. So I did. Last week, I introduced a bill to Parliament that would bring that transparency and help stamp out Russian corruption in the UK property market, using the text of the draft bill that the government shelved. It would send a signal to Putin that we will tackle him head on. And it had wide cross-party support – because this isn’t about party politics. It’s about national security.

The measures the UK government can and should take do not stop there. We must go further: making our democracy a national security priority and implementing the remainder of the Russia Report recommendations are two obvious next steps.

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