London property boom built on dirty money

Jonbvn

http://www.independent.co.uk/news/uk/home-news/london-property-boom-built-on-dirty-money-10083527.html#

Also in the FT

http://www.ft.com/cms/s/0/efa93784-c1b2-11e4-bd24-00144feab7de.html?siteedition=intl#axzz3TOx78Foe

Some 36,342 properties in London have been bought through hidden companies in offshore havens and while a majority of those will have been kept secret for legitimate privacy purposes, vast numbers are thought to have been bought
anonymously to hide stolen money.

TI’s research, which includes previously unreleased internal figures from the Metropolitan Police Proceeds of Corruption Unit, found that 75 per cent of properties owned by people under criminal investigation for corruption are held through secret offshore companies.

The research by non-profit organisation Transparency International, using Land Registry and Metropolitan Police data, builds on a study last year by the Financial Times that found at least £122bn of property in England and Wales was held in offshore havens.

purch

Without seeming to nitpick, I doubt whether it will still be £30 million by the time it gets from stage 1 to stage 4.

IronWolf

It would explain why people are willing to pay stupid amounts of money for property in london. If its stolen money you're more bothered with getting away with it than if the asset falls in price by 20%

CLAPTON

I'm confused

did anyone doubt that there is a huge amount of 'laundered' money from the many corrupt countries and people?

did anyone doubt that much of it ends up in what is seen as safe havens?

36,342 seems a modest number of properties in the context of the UK;
however if we don't like property being owned by overseas companies in tax havens we should change the law.

Loughton_Monkey

So what's the average price of these properties? Let's say £3 million each on average. That's a very healthy >£100 billion added to our GDP. It makes the annual £11 billion of GDP we get from prostitution and drugs look rather insignificant.

I find it a bit strange, though.

If I were to be a Nigerian government official, or a Russian embezzler with a cool £50 million of dirty money, I would indeed use all the accountants, offshore companies, layering, and obfuscation. But then why would I choose to invest the proceeds in a London Property rather than a secret bank account where I could continue to move it about, if necessary, at a moment's notice? A London property is extremely easy to 'seize' or 'freeze'.

Why isn't Mr Plod out there grabbing the occupier when he puts out the bin and asking him to 'help with enquiries'?

stator

The UK isn't really as safe as they make out. Foreign dictators and corrupt officials do have their assets in the U.K. seized.

wotsthat

Some 36,342 properties in London have been bought through hidden companies in offshore havens and while a majority of those will have been kept secret for legitimate privacy purposes, vast numbers are thought to have been bought anonymously to hide stolen money.

So the majority of 36,000 are legit but vast numbers are being used to hide stolen money? Maybe vast now means a minority of a small number.

If I'd a ton of ill gotten money stashed away I'd be renting.

michaels

And don't foreign companies pay oodles of tax for the priviledge of buying and holding UK property - excellent news for the funding of the NHs

cells

michaels wrote: »

And don't foreign companies pay oodles of tax for the priviledge of buying and holding UK property - excellent news for the funding of the NHs

Yes the enveloped property tax.


£143,750 per year for homes worth more than £20m and in a company

We should hope all expensive homes are owned within companies!

cells

Such companies pay or are supposed to pay an annual tax as follows


worth over £20m = £143,750 annual tax
Over £10m = £71,850 annual tax
Over £5m = £35,900 annual tax
Over £2m = £15,400 annual tax

Also they are adding bands from £0.5m up from this april. Plus the tax is increased annually.


I think a labor mansion tax if it ever comes into effect would just be this tax but applied to every home not just those inside companies

Conrad

One trend I've seen many times;


Turkish / Kurdish business owners (often 'Food Wine Centre' or fast food takeaway)
Typically asset rich, but show little income
Wife almost always on benefits
Usually the name spelling subtly varies across documents - keeps the authorities off the scent
Own several properties outright - rented out, not declared
Profits and incomes sent to Turkish Bank account
Later transfer this money back to UK saying it's from parents or a business sale in Turkey


This is not fringe stuff, but completely endemic, but the type of person that formerly would not hear of endemic Asian child gang abuse will also dismiss this as hearsay.


I wonder if those LSE surveys into whether migrants are a net benefit count all these tax dodging folk?


This is not 'racist' but simply my experience over and again, I would say it's nothing to do with ethnicity but everything to do with cultural habits (as per Greeks not paying much tax)