Russians exploiting property market to launder £ billions as it is "more difficult to set up a Netflix account than a business in the UK "

28 January 2021

Martin Cheek, MD at AML specialist SmartSearch said: “This analysis from the National Economic Crime Centre highlights yet again one of the biggest loopholes in our financial system, which must be closed as a matter of urgency.

“The head of the NECC has said it is too easy to set up companies here and that Russian “laundromats” were exploiting the opportunity to launder billions through London.

“It is a shocking revelation in some respects but can be of little surprise to those who are aware that setting up a business in the UK takes little ID verification. And Companies House doesn’t have the resources to monitor the millions of firms registered there for signs of fraud.

“It’s almost more difficult to set up a Netflix account than a business in the UK and organised criminals will continue to wash their dirty money until the system becomes much more robust. But brokers and advisers need to be scrupulous in terms of their ID checks and AML procedures with new customers in the meantime.

“The property market is a prime target for money laundering activity and relying on manual, document-based checks is simply inadequate faced against the tide of Russian (and other) money now flowing through the system.

“That is why switching to electronic verification has to be an imperative for any business in this sector, as it is safer, quicker and much more reliable in identifying criminal activity.

“By doing a smartsearch when onboarding new customers, all you need is a name, address and date of birth from them to give you access to records from hundreds of countries the around the world in an instant. It is the best protection against this criminal activity and be up and running online within 24 hours.”