15/03/2018 08:14 GMT | Updated 15/03/2018 08:21 GMT

As Britain Defends Itself Against Russia, Now Is The Time To Take Action On The Financial Front

The Sanctions and Anti-Money Laundering Bill currently going through Parliament gives ministers the chance to act quickly and decisively, if they accept Labour’s demands to take it

Michael Dunning via Getty Images

The poisoning of Sergei Skripal and his daughter Yulia in Salisbury is a horrendous crime. The use of the nerve agent Novichok by the Russians is a new low – even for President Putin, whose human rights record at home and abroad is abysmal.

Britain must take action to defend itself and we need a strategic approach to preventing these crimes both in the UK and abroad.

One very welcome change of heart from the Prime Minister on Wednesday was her decision to incorporate “Magnitsky” measures into the Sanction and Anti-Money Laundering Bill going through parliament now, as Labour has demanded for weeks. This will enable us to put sanctions on those who have committed gross human rights abuses such as torture, by freezing their assets and banning travel to the UK. But there is much more we need to do to tackle the underlying issues.

The first problem is that London has become a city through which the National Crime Agency estimates £90billion is laundered every year. These are the proceeds of major financial crimes – the looting of state assets by oligarchs from Russia and the former Soviet Union and the returns to violent drug gangs in Latin America.

Billions are stashed in 86,000 properties in this country – whose foreign owners are hidden. The Government have introduced Unexplained Wealth Orders, enabling the Government to seize assets but so far, only £22million has been seized, because the owners are unknown. Thus, crime is facilitated and our capital becomes unaffordable for young people.

A public register of real owners was promised by David Cameron in 2015 – the timetable has slipped and slithered back to 2021. We need to bring it forward now.

Secrecy is also at the root of the problem in the overseas territories’ tax havens. In Bermuda, the Cayman Islands and the British Virgin Islands (BVI), the latter of which is the territory which hosts 950,000 offshore companies, the shareholder registers are secret. The value of this information to HMRC and the National Crime Agency was demonstrated by the Panama and Paradise Papers leaks which enabled them to open investigations into dozens of people and pursue a £125million fraud.

A few examples, which could be episodes of McMafia, illustrate the problems.

In 2009, an unknown individual acquired a network of offshore-owned companies then invested in £147million worth of property in London. The managers of these companies were linked to Rakhat Aliyev, the former Kazakh secret police chief found hanged in an Austrian prison in February 2015 while awaiting trial for the murder of two bankers in his home country. The £147million London property empire included the Elvis and Beatles’ stores on Baker Street, as well as 221 Baker Street. The portfolio of companies that own 221 Baker Street are ultimately owned by a company in the British Virgin Islands.

In one of the biggest scandals – dubbed the Global Laundromat – the high street banks in Britain saw $740million pass through companies registered in the Isle of Man and the BVI using Russian funds.

In another example, the US courts found the North Koreans had used shell companies registered in the BVI to evade sanctions. We are responsible for tackling this because these are British overseas territories.

Transparency would lift the blanket under which these proceeds of crime are hidden.  It would also enable HMRC to collect the tax we need to fund our overstretched public services.

The Sanctions and Anti-Money Laundering Bill currently going through Parliament gives ministers the chance to act quickly and decisively, if they accept Labour’s demands to take it. As the UK takes robust action against Russia in a range of other areas, now is also the time for action on this vital financial front.

Helen Goodman is the Labour MP for Bishop Auckland