Economic Crime (Transparency and Enforcement) Bill

Catherine West Excerpts

2nd reading
Monday 7th March 2022 Commons Chamber

[Priti Patel]

I agree with the right hon. Lady, and I am also grateful to other Members who have not just highlighted this issue but given specific examples. A great deal of work is being done. It is important that we take a collective approach institutionally, and that our legal basis is sound and solid.

[Catherine West (Hornsey and Wood Green) (Lab)]

The Home Secretary is very generous in allowing so many interventions.

During the 2017 Parliament, the then Prime Minister appointed a tsar—for want of a better word—to fight corruption within the House, but over the years that role has become less effective. Does the Home Secretary think it should be re-established and refreshed, so that someone could really call out many of the issues that we know to be a problem in both the House of Commons and the House of Lords?

[Priti Patel]

I thank the hon. Lady for highlighting the role of our anti-corruption tsar, my hon. Friend the Member for Weston-super-Mare (John Penrose), who has been supporting the Government at every level. He has also supported me by helping with much of our work on illicit finance and economic crime. He comes to our roundtables, and spends a great deal of time dealing with matters concerning the City and transparency. I can therefore assure the House that we have that function up and running. We have a superb colleague supporting the Government on all those measures, and I am very grateful to him for his work.

Let me now explain the measures in the Bill in more detail. It sets a new global standard for transparency, which is thanks to the work of my hon. Friend the Member for Weston-super-Mare, but it also takes the whole-of-Government approach that many Select Committee reports have called for—I think it fair to say that I have read a few of those reports produced by colleagues and friends—in that it contains several measures from several Departments. It creates a register of overseas entities to crack down on foreign criminals who use the UK property market to launder money. A foreign company that wishes to own land in the UK will be required to identify its beneficial owners and to register them with Companies House. Once a company is registered, an overseas entity identity number will be provided, and that entity will be required to update its information annually.

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[Yvette Cooper (Normanton, Pontefract and Castleford) (Lab)]

I welcome the Bill before us today, at a time when rocket attacks are continuing, when homes, community centres and even kindergartens are being hit, and when families fleeing through the streets of Ukraine are being targeted for attack. The Russian President has launched an illegal war against a democratic state. It is a crime against a brave nation. As we stand united with Ukraine, we know that this is a battle for democracy against despotism.

Our country has to play its part. All of us want to see the strongest economic measures against Russia and against the oligarchs linked to the Russian regime who have made their wealth through corrupt and illicit practices, and against those who made their money not through their own sweat and toil, but through corruption and the concentration of power.

A few years ago, the Intelligence and Security Committee’s Russia report said that the UK has

“offered ideal mechanisms by which illicit finance could be recycled through what has been referred to as the London ‘laundromat’”.

That is damning. It issued this warning nearly three years ago:

“It is not just the oligarchs…the arrival of Russian money has resulted in a growth industry of ‘enablers’”—

individuals and organisations that manage and lobby for the Russian elite. Chatham House has referred to Britain’s “kleptocracy problem”.

The fact that corrupt elites from all over the world can launder their money and their reputations through our capital city is shameful. The fact that an industry of enablers has grown up here to facilitate those corrupt elites, to help them hide their money, evade tax or launder proceeds of crime is deeply damaging to our economy, to our international reputation, to the rule of law and to democracy.

So yes, we welcome the Bill. We welcome the chance of stronger sanctions and measures to make it easier to put pressure now on Russia in the face of this appalling war. We welcome the improvements to unexplained wealth orders, making it easier for the police to use them and harder for those with endless wealth to use their riches to block them, and we welcome the register of overseas entities to get some transparency and to make it harder for corrupt elites to hide their wealth in the UK property market. We will support the Bill today and support the process to get it through Parliament as fast as possible.

Many of these measures should have been introduced some years ago. Some that we need and have long been promised are not yet before us. All of us should accept that some of this action should have taken place earlier, because we had been warned. We had been warned by Transparency International back in 2015; by the evidence from leaked international documents such as the Pandora papers; by the National Crime Agency, which said that unexplained wealth orders were too hard to use; by Members of this House when we confronted the murderous intent and actions by Russian agents on British soil during the Salisbury attack four years ago; and by the damning Russia report. We were promised reforms in many of these areas in 2016. There was a consultation in 2018 and reference to a Bill in the Queen’s speech in 2019. We still do not have the much-needed Companies House reforms before us today.

[Catherine West]

Does my right hon. Friend agree that, had the Government got a move on with this years ago, we would be able to deal with phoenix companies today, which rip off members of our communities day after day? We could have dealt with that, too, in one blow.

[Yvette Cooper]

I agree with my hon. Friend that action should have been taken much earlier to address that, which should mean that there is an even greater imperative on us all now to ensure not only that this Bill passes, but that the subsequent economic crime Bill that we badly need is brought forward as swiftly as possible. That is one of the areas where the Opposition have submitted amendments.