Naming And Shaming Property Barons Won’t Work

Prime Minister David Cameron’s proposals to make property ownership more transparent to tackle suspected corruption and money laundering won’t work, claim lawyers and property experts.

Cameron has announced that the government wants to publish lists of companies fronting wealthy offshore owners allegedly washing dirty cash through the prestige London property market.

He argues that many of the companies registered overseas are buying expensive homes in London for corrupt officials and politicians living in other countries.

Cameron wants to make property ownership more transparent by publishing the names of these companies.

“Many of these expensive homes that cost millions of pounds are bought from the proceeds of plundered and laundered money and I will not let Britain become a tax haven for criminals and fraudsters,” said Cameron.

Offshore companies

His comments follow the revelation that the Metropolitan Police have probed 144 property purchases worth almost £200 million in the past 10 years because detectives suspected the cash came from illicit sources.

However, many experts are frowning on his plans and labelled them a gimmick.

“What’s the point in publishing information that is already openly listed on the Land Registry and Companies House,” said James Quarmby, head of private wealth at international law firm Stephenson Harwood.

“It’s just a gimmick because the government has no power to reveal the people behind companies registered in other jurisdictions.”

Much of the property Cameron was referencing is owned by offshore companies listed in Panama, The Channel Islands or the Cayman Islands.

Secretive owners

In many cases these companies are run by shadow directors to mask the identities of the real owners.

Britain is heading an initiative to make company registers in British Crown Dependencies and Offshore Territories more open, but this is likely to take some time to come to fruition.

Meanwhile, offshore companies own more than 100,000 properties in England and Wales with a total value of £122 billion, according to the Land Registry.

Almost 10% of homes in Westminster, 7% in Kensington and Chelsea and 4.5% in the City are registered to offshore companies.

The National Crime Agency claims criminals in other countries are investing their money in London and because they are willing to pay high prices, are pushing up property values.

Many expensive properties stand empty as investments while their owners wait for prices to rise so they can sell at a profit.