The world’s first public register is set to increase transparency and reduce criminal activity by forcing foreign companies who own UK properties to reveal their ultimate owners
The new public information will make it easier for law enforcement agencies to tackle money laundering and relevant criminal activity.
Research suggests that 75% of the UK property industry believes the new register will promote transparency in the sector while reducing the potential for illegal activity.
Under new draft law laid in parliament, criminals who illegally profit from owning British property could face up to five years in jail.
Business Minister Richard Harrington said:
“The UK is known around the world for its open and dependable business environment and this reputation is maintained by keeping under review our required high standards.
“That is why we are introducing the world’s first public register which will expose the ultimate owners of overseas shell companies, giving authorities the information, they need to come down on criminals who launder their dirty money through the UK’s property market and to seize the proceeds of crime.
“While the vast majority of foreign companies which buy property in the UK do so legitimately, this world-leading register will help ensure the UK remains a great dependable place to work, invest and do business.”
The register forms part of a wider crackdown on criminals laundering their dirty money in the UK. The penalties include:
- a ban on any foreign entity selling or leasing property without first publicly declaring its beneficial owner; an individual found to have committed this offence could face up to 5 years in jail and an unlimited fine
- individuals who fail to register overseas entities when instructed face up two years in jail and an unlimited fine
- individuals who knowingly try and deceive the register by providing false information face up 2 years in jail and an unlimited fine
UK government minister for Scotland Lord Duncan said:
“For too long criminals have been able to use the property industry as a front for investing dodgy funds, hiding dirty money and evading the law. This stops now.
“Most people who invest in property across the UK do so fairly, and legitimately, but the UK government is clear that there is no longer any room for those that seek to exploit the system to hide.”
The UK has taken a leading role in the fight against money laundering and this world-leading register, which will go live by 2021, will reduce opportunities for criminals to hide.