Human Rights Abuses: Magnitsky Sanctions
Debate between Judith Cummins and Phil Brickell(1 week, 3 days ago)
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Phil Brickell
My hon. Friend is quite right about the spheres of influence that Russia seeks to exert across central and eastern Europe.
Ivanishvili could be sanctioned under any number of our regimes—Magnitsky, global anti-corruption or even the Russian sanctions regime given his reported links to the Kremlin and his blatant kowtowing to Moscow. Just this morning, I was made aware that Georgian Dream has increased state financing for the Kulevi oil refinery, which Reuters has reported received its first shipment of Russian oil last October. The refinery itself is linked to Vladimir Alekseev, first deputy chief of Russia’s GRU. That seems to be an obvious route for sanctions violations, and I hope it will be added to Ivanishvili’s rap sheet. I know the Minister will be unable to comment on individual cases, but can he at least confirm that Ivanishvili’s supposed status as too big to fail due to his alleged personal importance to the Georgian economy does not preclude him from being sanctioned by this country?
I will come to the United States later, but our allies across the Atlantic sanctioned Ivanishvili on 27 December 2024 for undermining democratic processes on behalf of, or for the benefit of, Russia. I certainly do not suggest that we follow the US in every aspect of foreign policy, but it is correct in applying that designation. Sanctioning cronies and underlings can make an impact, but let us be clear that the fish rots from the head. My fear is that our silence on Ivanishvili sends the wrong message to would-be kleptocrats around the world.
Let me turn to Hong Kong and the ongoing repression there, which is of keen interest to me and the valued community of Hongkongers across my Bolton West constituency. The dismantling of Hong Kong’s freedoms is unacceptable. Since the imposition of the national security law, we have seen the systematic criminalisation of dissent: independent media shut down, civil society organisations dissolved, elected opposition figures jailed, and fundamental freedoms erased in all but name. This is textbook human rights abuse.
The case of Jimmy Lai, who has already been mentioned, symbolises that injustice—a point I was reminded of by constituents of mine who used to work with him back in Hong Kong. As a British national, a publisher and a peaceful advocate of democracy, Jimmy Lai has been imprisoned for years for exercising rights that we regard in this place as fundamental. He now faces the prospect of spending the rest of his life behind bars under a law designed to silence free speech, not to deliver justice. Of course, I welcomed the Foreign Secretary’s strong condemnation of Jimmy Lai’s sham trial last month, but words alone do not protect political prisoners. If Magnitsky sanctions are to retain any credibility, they must be used against those responsible for the erosion of Hong Kong’s autonomy and for the persecution of individuals such as Jimmy Lai. That includes officials who designed, implemented and enforced the national security law and those who have overseen its use to crush free expression and political participation.
That brings me to a wider point. We are entering a period in which the United States cannot always be relied on to apply evidence-based sanctions. In that context, the UK cannot simply wait for Washington to lead. We must be prepared to act where the United States will not. We should also not be afraid, as critical friends, to point out where the US gets it wrong. I asked the Minister earlier this week at the Foreign Affairs Committee for his response to Trump’s sanctioning of two British citizens for seeking to, as Secretary Rubio sees it, “coerce” American tech platforms into suppressing free speech. Does the Minister agree that that is dangerous nonsense?
That brings me to my second theme: enforcement. Increasing designations alone is not enough. Sanctions without enforcement are no sanction at all; they are just suggestions. We now have a vast and complex sanctions architecture—Magnitsky sanctions, Russia sanctions and anti-corruption sanctions. Since Putin’s barbaric invasion of Ukraine, we have had a massive boost in our own sanctions capacity and seen a huge undertaking in the private sector to keep up, yet enforcement in the UK remains worryingly weak.
We know that sanctions are being evaded. We heard earlier about Roman Abramovich reportedly transferring his UK property empire to his children just weeks before being sanctioned—the very same individual who is now being represented by the Conservative shadow Attorney General over a dispute with the Jersey Government on the source of his wealth. As my hon. Friend the Member for Kensington and Bayswater (Joe Powell) outlined forensically, if the Opposition are serious about standing by Ukraine, they cannot have him as their top Law Officer, serving in the other place and attending shadow Cabinet meetings. It is simply incredible. Does the Minister agree that Lord Wolfson’s position in the shadow Cabinet and attendance of those meetings is now completely untenable?
The Office of Financial Sanctions Implementation has concluded that it is “almost certain” that UK lawyers, estate agents and property service firms have helped clients evade asset freezes. As my hon. Friend the Member for South Dorset (Lloyd Hatton) outlined, in the past year OFSI has imposed just three fines for breaches of the UK’s sanctions regime, totalling just over £622,000. That is a rounding error compared with the scale of wealth at stake, and it is simply not a credible deterrent. All the while, there have been no breaches of Magnitsky sanctions in the past year.
This issue is acute in the British overseas territories, where low policing capacity and high financial secrecy create ideal conditions for sanctions evasion. There have been some laudable efforts in the OTs to enforce sanctions. However, I have too often been made aware of civil society organisations submitting detailed evidence of Magnitsky sanctions breaches in the overseas territories but receiving no meaningful response at all from those jurisdictions. Will the Minister assure me today that he will ensure that British overseas territories that receive such detailed allegations will act on them?
We must tackle head-on the scourge of corporate secrecy in offshore financial centres linked to the UK. If we are to ensure that our sanctions bite as much as possible, there is an urgent need for those overseas territories that continue to drag their feet—including the British Virgin Islands—to finally adopt fully public registers of beneficial ownership, as they have promised time and again but failed to deliver. As an interim step, the Minister will agree that individuals with a legitimate interest, including journalists and civil society, must have meaningful access to beneficial ownership information. Without that transparency, asset freezes cannot be enforced effectively. I look forward to the update on this issue promised earlier this year in the Government’s new anti-corruption strategy, but can the Minister provide any further information on timelines—
Madam Deputy Speaker (Judith Cummins)
Order. I encourage the hon. Gentleman to bring his remarks to a conclusion, because we have another debate to follow, and we still have the Front-Bench spokespeople to come.
Phil Brickell
Thank you, Madam Deputy Speaker.
Transparency is the name of the game here, so will the Minister confirm whether his Department has looked at publishing comprehensive data on assets frozen within UK jurisdictions, broken down by asset class, including assets held by individuals, state- owned enterprises and states themselves? The reason I ask is simple: Parliament cannot assess the effectiveness of our regimes if it cannot see the full picture.
Let me end with this. Magnitsky sanctions are one of the most powerful tools we have to defend human rights, but they work only if they are used consistently, enforced rigorously and connected clearly to accountability and reparations. If the UK wants to be a global champion of human rights, it must stop being a safe haven for those who abuse them and start ensuring that sanctions mean something on paper and in practice.
Budget Resolutions
Debate between Judith Cummins and Phil Brickell(1 month, 3 weeks ago)
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Phil Brickell (Bolton West) (Lab)
I warmly welcome the Chancellor’s Budget. It will improve the lives of my constituents by putting £150 back into the pockets of working people through removing levies on energy bills and by lifting 2,570 children out of poverty. This is a Budget with fairness at its core; it reduces child poverty, has more funding for the NHS and has more investment in school libraries. After the chaos of the 2022 Truss mini-Budget, the Chancellor has shown what real fiscal discipline looks like: inflation falling, growth prioritised and proper headroom restored.
I am particularly pleased that the Chancellor has stared down the sloganeers at both extremes. She has rejected the failed trickle-down instincts of the populist right, which bequeathed this Government with a legacy of failed austerity and profligate wasting of taxpayers’ money on dodgy PPE contracts during the pandemic. She has also dismissed unevidenced calls from the left-wing populists for a wealth tax, when it has no answers to the hard questions about capital flight, offshore assets or our overburdened enforcement agencies. All the while, she has increased the burden on those with the broadest shoulders, including via the new high-value council tax surcharge on homes valued at more than £2 million, ensuring that homeowners in mansions are not paying less in council tax than someone living in a mid-terrace in Blackrod.
I thank the Chancellor for heeding my calls by introducing new measures to tackle high street tax dodging and organised crime. The National Crime Agency estimates that some £12 billion in criminal cash is generated in the UK every year, including in the suspicious vape shops we have all clocked while walking round our constituencies. Those suspect enterprises not only erode the civic pride we have in our high streets, but undercut genuine businesses looking to provide a service and make ends meet. I welcome the Chancellor’s commitment to a cross-Government taskforce to tackle tax abuse and money laundering on our high streets, backed by £50 million every year over the next three years, which is funded by an increase in the economic crime levy paid for by the banks and other professional services firms. That is despite the platitudes from Lib Dem Members saying that banks are not being asked to pay more, when actually they are.
I will bring the issue of tax dodging on our high streets to life with an example of just how egregious some of these wheezes truly are. In the brief time that I have, let me talk a little about the world of snails—snail fornication, snail gestation, snail feed and snail cannibalism. London Centric’s Jim Waterson recently published an investigative report on this topic. It details how former Lancashire shoe salesman, Terry Ball, runs elaborate snail-based tax avoidance schemes that are costing councils millions of pounds simply by placing boxes of snails in vacant office buildings in an attempt to exempt them from business rates.
The scheme, perfected over many years to prevent the snails from eating one another and stop mass snail fornication, allows unscrupulous individuals to claim that empty warehouses are being used for agricultural purposes. In turn, landlords are granted a business rates exemption. If the firms in question are challenged by the local council, they are simply liquidated. They hold no assets, so no business rates can be claimed back, and they magically reappear under the guise of another mollusc-based enterprise registered at Companies House—it is taking shell companies to the extreme.
One local council has reported a loss of £370,000 in tax receipts just because of this specific mollusc-based wheeze. This is not just a quirky anecdote; it is a hard-edged example of how loopholes in our system are being exploited, made all the easier by the Tories’ decision in the last Parliament to abolish the Office of Tax Simplification. Indeed, the very same council is reporting losses of £10 million a year due to non-payment of business rates.
I welcome the further steps announced by the Chancellor yesterday, such as rewards for informants of high-value tax fraud, extra funding for trading standards, enhancing tax transparency on real estate, 350 new criminal investigators to tackle fraud and illicit tobacco and vapes, and a boost to HMRC to go after tax dodgers and their unscrupulous advisers. We need to do a lot more, but I commend the Chancellor. I urge her to continue in the same vein by reforming reliefs, strengthening enforcement and sending a message that Britain no longer tolerates tax gimmicks—whether involving snails, shell companies, or slimy advisers.