Almost 50,000 UK properties owned by foreign companies remain hidden from public view despite new transparency rules.
The purpose of the Overseas Entities Register, due to start in August 2022, is to show who ultimately owns UK property.
But an analysis by JEE News found that almost half of firms required to declare who is behind them failed to do so.
Labor MP Margaret Hodge said the legislation was “not fit for purpose”.
A UK government spokesman said the register “has been an invaluable source of information for law enforcement and the tax and revenue services.”
The UK government has long pledged to crack down on “corrupt elites” from abroad, including “Russian oligarchs and kleptocrats”, using UK property to launder illicit wealth.
Ministers insisted they would crack down on foreign criminals using UK property to launder money, ensuring they “cannot hide behind secret chains of shell companies”.
As a result, under a law passed in February 2022 in response to Russia’s invasion of Ukraine, ministers said anonymous foreign companies wishing to buy UK land or property must disclose full details of those individuals. would need those who ultimately owned them. Overseas organizations that already owned land in the UK were given six months to do so.
Now that the six-month grace period is over – all people, regardless of their reputation, should be exposed for the first time behind the companies that own thousands of British properties.
JEE News combined thousands of filings from the new register with Land Registry records. The analysis found that around 18,000 offshore companies – which between them have more than 50,000 properties in England and Wales – either ignored the law altogether or submitted information in a way that was impossible for the public to detect. After all, who are the people? Take advantage of yourself and them.
“While the Register is beginning to serve its intended purpose, our analysis shows that there are many companies that are trying to circumvent the rules, not knowing they exist, or not fully complying with them. are being overlooked,” says Duncan Hames, director of policy at Transparency. International UK.
To understand how the law is and isn’t working, it helps to look at three very expensive properties. First up is a pair of luxury apartments. The second is a sprawling £48m estate in north London, the third a £10m country mansion.
All have been linked in one way or another to figures connected to Vladimir Putin’s regime.
For example, look at two luxury flats in central London estimated to be worth £11m.
Their ownership was first reported by the Anti-Corruption Foundation by former Russian Deputy Prime Minister Igor Shuvalov, who was jailed by Russian opposition leader Alexei Navalny.
According to the UK government, which placed him under the ban in March 2022, Mr Shuvalov – who heads the management board of a Russian bank – is “a core part of Putin’s inner circle”.
And now the Register has confirmed that he and his wife are the ultimate owners of the flats, which are being held by a Russian company, Suva Real Estate LLC.
A spokesman for Mr Shovalov told JEE News last year that the issues “have been the subject of an authorized government audit” and that “no complaints have ever been lodged”.
But while there are thousands of instances where the register is functioning, the ultimate ownership of thousands of properties is hidden from public view.
Take Beechwood House, a north London estate bought for £48m in 2008 when it was valued at around £85m.
