More than 3,000 properties in Camden and Barnet held in secret offshore havens
- Credit: PA Wire/Press Association Images
New figures have revealed more than 3,000 properties in Camden and Barnet are registered in secret offshore havens – among the highest numbers in the capital.
A leading anti-corruption charity released the data yesterday as it called on the government to implement tough new regulations to increase transparency over property ownership and crack down on money laundered through UK real estate.
Transparency International (TI) UK says legal loopholes make luxury property, particularly in prime London markets such as Hampstead, attractive to criminals, corrupt politicians and businessmen worldwide who want to conceal dirty money.
Nick Maxwell, head of research at TI, described the potential impacts on local communities.
“Typically such large levels of investments through offshore corporate structures does have an effect in raising average prices, with a ripple effect throughout the market,” he said. “It removes availability of housing stock and what we’ve seen is where high-end property is bought for investment purposes we have the issue of empty mansions and ghost properties.
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“Clearly there’s an issue in terms of community life, lack of local taxation and detrimental effects to local business life.”
TI’s report, titled Corruption On Your Doorstep, says there is growing evidence that London property has become a safe haven for corrupt capital stolen from around the world.
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This is facilitated by laws which allow UK property to be owned by secret offshore companies.
TI used data from the Land Registry, available for the first time, to show that 40,725 London properties are held by foreign companies, which are exempt from capital gains tax, succession taxes and stamp duty.
These include 2,084 properties in Camden - the third highest in London, and 1,212 in Barnet – the fifth highest. The City of Westminster has the largest number at 11,457.
Government changes to legislation, set to become law before the general election in May, will force all UK registered companies that own property to declare the beneficial owner to the Land Registry, revealing for the first time the true owners of property.
But TI says this does not go far enough as the legislation will not apply to foreign companies registered in offshore havens, such as the British Virgin Islands, Jersey, the Isle of Man, Guernsey and Panama.
The data showed real estate registered in offshore havens is disproportionately involved in criminal investigations, with 75 per cent of properties investigated by the Metropolitan Police’s Proceeds of Crime Unit since 2004 held by companies in a secrecy jurisdiction.
TI highlighted the cases of former Nigerian governor James Ibori, who used embezzled state funds to buy homes in Hampstead, St John’s Wood and Regent’s Park, and the £10million Gaddafi mansion in Winnington Close, Hampstead Garden Suburb, which was recovered by the transitional government in Libya through a civil court action, to highlight the loopholes.
The charity has called for offshore companies to be held to the same levels of transparency as UK-based companies and for a change to Money Laundering Regulations in the UK to require estate agents to undertake due diligence checks on sellers and not just buyers of property as currently.
Jessica Learmond-Criqui, chair of Hampstead Shops Town Team, backed calls for more transparency around owners of commercial property held by companies. She said shops on Heath Street are sitting empty wth interested parties unable to contact owners.
“I would call for a register of commercial properties including the name and contact details of owners so that they can be contacted, whether by Camden Council, us, or members of the community who want to discuss shops on the high street,” she said.
“It’s long overdue and there’s no conceivable reason why government can’t do that.”