Criminals have been using the London property industry to launder money for far too long. Overseas shell companies are particularly problematic. The government has been fighting this exploitation of the system for many years.
New rules were brought into place in 2017 whereby stricter checks were mandatory across the EU to tackle this. For example, estate agents are now required to do anti-money laundering checks. Purchasers and sellers are both subject to the checks. Firms that are non compliant have faced massive six and seven figure fines.
New Register Revealed
New draft laws were laid in Parliament on 23rd July. Owners must explicitly be named by foreign companies in possession of UK properties. Up until now any anonymous company could buy or sell property with no disclosure of who the purchaser is. This will be the world’s first public register.
Criminals who profit from owning British property will face 5 years in jail. Anyone failing to register overseas entities will face up to 2 years in prison alongside an unlimited fine. Likewise, people knowingly providing false information also face up to 2 years in prison along with an unlimited fine. It is on the whole, a positive attempt to quash this kind of activity.
Why London’s Property Market?
London has traditionally been the main city in which this activity is happening. The prominence of the London property market is in fact the main reason. Notably, the abundance of excellent legal and accountancy services in the city is another key factor. London is not the only city however, with University towns like York and Manchester to name but two currently popular.
What Now?
The government feels that this new law will crack open these hidden companies. The type of criminals we need to uncover includes terrorists. We cannot afford to allow these people to hide their money on our shores. If we reduce the loopholes, ultimately we will have more properties for sale to genuine buyers. This register will go live by 2021.
We support genuine Investors interested in London Property
Henry Wiltshire are fully on board with this new legislation. We support genuine people buying, selling and letting throughout London. If you have any questions for us please give us a call. Our team of experts at Hayes are ready to talk to you.
