Londongrad: Oligarchs’ homes could be seized in ‘dirty money’ crackdown

Council leader Adam Hug said many “see Belgravia, Knightsbridge, Mayfair and other parts of Westminster as places to rinse their money”.

Oligarchs’ homes in some of the richest parts of London could be seized by a council determined to crack down on so-called “dirty money” in the borough.

Labour-run Westminster council is now the UK’s first local authority to formally campaign on foreign money - including considering compulsory purchase orders on some properties.

Council leader Adam Hug said many “see Belgravia, Knightsbridge, Mayfair and other parts of Westminster as places to rinse their money”.

The borough has signed a fair tax pledge and is calling on the government to toughen up the National Crime Agency and HMRC, raise Companies House fees and tighten property laws.

Terraced residential properties in the affluent Belgravia area of London. Photo: Getty

It comes as part of a wider bid to combat the capital’s reputation as the European centre for money laundering.

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And today (Thursday, September 22) major London property owners, anti-corruption experts and officials joined the borough in its new ‘Westminster Against Dirty Money’ campaign.

Properties in the area registered to owners in Jersey have risen by 300% since 2010, while there has been a rise of 1,200% in homes listed under Russian ownership.

The explosion has prompted fears that property is being used to launder questionable cash.

According to the Guardian, the local authority could be set to compulsorily purchase a home registered to the Seychelles, after its owner ran into significant council tax arrears.

Residents also face lengthy waits for affordable housing, with 4,000 households on the list.

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Transparency International UK (TIUK) says alleged corrupt or Kremlin- linked Russians bought property worth £430m in Westminster since 2016 - more than any other UK area.

Neighbour Kensington and Chelsea is thought to have £283m worth of similar property.

£8bn worth of property, businesses and other assets in the UK are Russian-owned, with £1.1bn invested in London homes. Photo: Getty

Mr Hug added: “Westminster’s dirty secret has been known for many years.

“Those in power looked the other way for too long as money of questionable origin flooded into London and investors took advantage of our relatively lax laws.

“It took war in Ukraine to refocus attention on oligarch investments. London has become a European laundromat for dirty money - but the problem goes wider than Putin’s henchman.

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“It not only damages the reputation of our city by supporting authoritarianism abroad but drains the vitality of areas with empty or under-used homes.”

It comes after the council launched a crackdown on Oxford Street US-style candy shops avoiding paying business rates - with 30 stores under investigation for evasion totalling £8m.

At a full council meeting last night (Wednesday, September 22), a motion to approve signing the fair tax pledge and commit to tackling economic crime was passed.

Joe Powell, founder of resident-led campaign group Kensington Against Dirty Money, said: “[We’re] delighted our neighbours will be launching Westminster’s anti-dirty money strategy this week.

“Would never have imagined this when we launched the Kensington Against Dirty Money campaign earlier this year. The time for action is now.”

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Mr Hug added: “Companies House does not have the powers or resources to address those who set up opaque shell companies to launder and export money from London.

“There are more background checks required to get a local authority lending card than to set up a company in the UK.

“We want to work with government ministers and agencies to crack down on dirty money and ensure agencies like HMRC and the National Crime Agency are properly resourced.”

The Treasury and the Home Office have been approached for comment.