Thousands of London's properties are held by overseas companies registered in so-called secrecy havens, obscuring the details of their true ownership, a report out today has found.
The report from Transparency International UK and Thomson Reuters identified 44,022 land titles owned by 23,653 overseas companies in Land Registry data. Of these, 91 per cent of companies, holding 40,098 of the land titles between them, were registered in a secrecy jurisdiction, such as the British Virgin Islands, Jersey or Panama.
In secrecy jurisdictions, information about who owns companies is not publicly available, making it difficult to trace the true ownership of assets. While there are plenty of legitimate reasons for setting up corporates in one of these countries, the report noted that such establishments are also sometimes used by less scrupulous individuals wishing to launder money.
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The report also identified 986 land titles held by companies with links to politically exposed persons – someone who has been, or is close to somebody who has been trusted with a key public function – although the researchers noted the actual figure could be much higher, thanks to gaps in the data available.
In addition, basic details was not traceable for half of the companies the researchers looked into, despite being able to cross-reference to leaked information such as the Panama Papers and using advanced matching techniques.
"Despite the global scandal of the Panama Papers, London's property market continues to be a safe haven for corrupt individuals, through anonymous ownership," said Rachel Davies, head of advocacy at Transparency International UK. "Commitments made by the government are positive, but this new research underlines the danger if the promising words don't turn swiftly to action."
Government has already pledged to pull together a public register of beneficial ownership information for companies which own or are looking to buy property in the UK, with an April 2018 deadline to get this up and running.
"Londoners are right to be concerned that while the red carpet is rolled out for the corrupt elite, the capital is suffering from a housing crisis in which homes are becoming increasingly unaffordable," Davies continued.
Phil Cotter, managing director of risk and supply chain at Thomson Reuters, added:
We worked with Transparency International, combining our datasets with publicly available information to shed light on who really owns land and property in London. But the real surprise was how little information was available, and how difficult it is to find out who exactly owns some of London's prime land and property.
A Home Office spokesperson said:
The UK is one of the best places in the world to do business and we are determined to keep it that way which is why we are taking action to protect the integrity of our financial system...We will not stand by and watch criminals use the UK to launder their dirty money.