01 July 2022

Categories: Legal News , International , Criminal , Fraud

LNB news: Ukraine conflict: HoC report sets out recommendations to tackle illicit finance

The House of Commons Foreign Affairs Committee has published the second report of session 2022-23, entitled ‘The cost of complacency: illicit finance and the war in Ukraine’. The report welcomes the Economic Crime (Transparency and Enforcement) Act 2022 (EC(TE)A 2022), but concludes that the measures do not go far or fast enough and do little to address the fundamental mismatch between the resources of law enforcement agencies and their target

Lexis®Library update: The report calls on the government to increase substantially funding and expert resourcing for key law enforcement agencies like the National Crime Agency (NCA) and Serious Fraud Office (SFO), and increase resources at the FCDO’s sanctions unit. It also calls on the government to develop a comprehensive transatlantic partnership to curb kleptocracy and to engage meaningfully with illicit finance as a foreign police issue.

The report states that it is an assessment of ‘the consequences of the complacency of successive governments towards illicit finance and the adequacy of the current government’s response’. With regards to the register of beneficial ownership of property by overseas entities, it recommends that the FCDO ensures timely and effective implementation of the Companies House register of overseas entities that own UK property. It notes that although the EC(TE)A 2022 seeks to make it easier to apply for Unexplained Wealth Orders (UWOs), limited law enforcement budgets risk its efficacy. It calls on government to ensure a substantial increase in funding and expert resourcing for the NCA, SFO and other responsible agencies.

Among other things, the report also:

• calls on government to publish its review of the Tier 1 investor visa scheme without delay and explain whether it intends to review investor visas issued since 2015; what action it will take in relation to those who were granted a visa without due diligence, particularly those who now hold permanent residency or British citizenship; and what action it has taken against those it has deemed to be a national security risk

• calls on the FCDO to ensure that public registers of beneficial ownership in the Overseas Territories and Crown Dependencies are implemented by early 2023 with full and free access to company data, not limited to single entries; the report further recommends that the government leverages its access to information through the Exchange of Notes procedure to proactively request information about non-transparent companies and assets, which it could then make available to banks and partner countries to support sanctions against Russia or publish publicly, where appropriate to do so

• calls on the UK to demonstrate leadership on sanctions through supporting partners with financial intelligence gathered through the UK’s central role in global finance and calls for clear guidance on sanctions compliance for the private sector

Next steps
The Committee will publish a final report which will consider the ‘wider, systemic illicit and emerging financial threats and innovations that are transforming the global economic and financial system, and how countries are competing to shape the system of the future’. This will include ways in which the FCDO can work in concert with other departments to curb professional enablers. The report will also consider how the FCDO should work across government to encourage reform of corporate criminal liability laws which mean that it is difficult to hold large companies to account for economic crimes.

Source: ‘The cost of complacency: illicit finance and the war in Ukraine’

This content was first published by LNB News / Lexis®Library, a LexisNexis® company, on 30 June 2022 and is published with permission. Further information can be found at: https://www.lexisnexis.co.uk/

Categories: Legal News , International , Criminal , Fraud

LNB news: Ukraine conflict: HoC report sets out recommendations to tackle illicit finance

Categories: Legal News , International , Criminal , Fraud

Among other things, the report also:

Source: ‘The cost of complacency: illicit finance and the war in Ukraine’

Categories: Legal News , International , Criminal , Fraud

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LNB news: Ukraine conflict: HoC report sets out recommendations to tackle illicit finance

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