Joe Powell Co-founder of Kensington Against Dirty Money 18th April 2022 Blog Share Tweet Photo by José Pablo Iglesias on Unsplash Six years after it was first promised by the Government, an Economic Crime Act was finally passed last month to increase transparency over who owns and controls property in Britain. The new law would have not happened without the Co-operative Party and civil society around the country pushing for action in the wake of the invasion of Ukraine. Campaigners showed how anonymous foreign owned property is a prime vehicle for money laundering and corruption by oligarchs, undermines our high streets and erodes local communities. It is clear however, that this law will not solve the problem alone. Local residents, businesses, charities and councillors need to keep mobilising and pushing for change at the national and local level. I co-founded Kensington Against Dirty Money to make sure our Borough was leading by example at the epicentre of Britain’s dirty money problem. We have over 6,000 properties registered to anonymous foreign shell companies. Many stand empty. Several have been revealed to be controlled by prominent oligarchs on the UK sanctions list. Just last week, new research found one in ten adults in our borough are non-domiciled for tax purposes. This is while over 3,000 households are on the housing waiting list. Dirty money sits at the heart of our housing crisis. Other boroughs across the country will have their own examples of how opaque ownership affects their local community. This matters not only for residential luxury property, but for our high streets too. Compared to shops owned by the public sector, those owned by overseas investors are twice as likely to be vacant. When those investors are using anonymous companies in tax havens, it makes it impossible for communities and councils to push for change. It undermines a fair level playing field for local businesses to compete. The new law will create a public registry of who the real beneficial owners are of foreign owned property in Britain, but there are plenty of loopholes that need addressing. That is why the next stage of this campaign is focused on securing a second Economic Crime Bill in the Queen’s Speech on May 10th. This second Bill should give the power to Companies House to monitor, verify and investigate suspicious companies, and to ensure that information in the new registry is accurate. It should also address the professional services such as banks, accountants and law firms that too often have helped enable financial crime in Britain. This can be done by improving the money laundering supervision regime and by ensuring there is a credible deterrent, including creating a new offence for failure to prevent money laundering, fraud, sanctions evasion and false accounting. Funding for enforcement by the National Crime Agency also needs to significantly increase, a move that will likely pay for itself. Upcoming local elections in many parts of the country are an opportunity to tackle ownership issues in our communities by electing councillors who are champions for this issue. In Kensington, one in eight properties are either long-term empty or second homes. Our campaign is pushing the council to effectively audit our empty homes problem, assess why measures such as a council tax levy are not working, and take more aggressive steps to tackle empty property, including the use of Empty Dwelling Management Orders (EDMOs) on properties that have been empty for more than two years. We also want to see measures to tackle our affordable housing crisis with more investment in social housing, including co-operatives. Additionally, the process around planning decisions needs scrutiny, with far more public participation and transparency to ensure the views of major developers do not trump those of local residents. A new campaign from Transparency International has identified major corruption risks in local government planning decisions, which can be mitigated by clearer standards and mandatory transparency over local council dealings with developers. For our co-operative movement to successfully push for these changes, we need diverse local coalitions at the grassroots level to make the case to council candidates and national representatives that ownership matters. Local Co-op Party branches can be at the forefront of this campaign, showing how opaque property ownership structures and dirty money have fuelled inequality in Britain. The next few weeks will be crucial in determining whether we can break Britain’s unhealthy relationship with illicit finance, and build a more democratic property ownership system that works for everyone. Agree? Sign the campaign here.