The UK government’s rhetoric on clamping down on Russian money laundering in Britain “has not been matched with constructive action”, a critical report by a cross-party committee of MPs has found.
The report by the House of Commons foreign affairs select committee suggested that “morally bankrupt billionaires” were using the UK as “a safe-deposit box”, and concluded it was “shameful that it has taken a war to galvanise the government into action”.
“The government’s lack of willingness to bring forward legislation stemming the flow of Russian money has directly contributed to the UK’s status as a safe haven for corrupt wealth,” the report said.
The committee concluded that current measures to root out dirty Russian money in the UK were insufficient, and called for extra funding for the National Crime Agency and the Serious Fraud Office.
“Without the necessary means and resources, enforcement agencies are toothless,” the report said.
Foreign secretary Liz Truss rejected the claim the government had acted too slowly and had delayed its response following Russia’s invasion of Ukraine.
“We acted as soon as we could,” she told Sky News from the Nato summit in Madrid. “We have sanctioned, as a country, more individuals and entities in Russia than any other government in the world.
“We passed emergency legislation as soon as this appalling war was perpetrated. We have been able to hit Russia hard with sanctions. Most recently we sanctioned Russian gold. The UK has led on this.”
MPs on the foreign affairs committee also called on the government to publish its long-awaited review of its controversial Tier 1 investor visa scheme, which was closed in February.
The “golden visa” scheme allowed people with at least £2mn in investment funds and a UK bank account to apply for residency rights, along with their family, but it was criticised for being open to abuse.
“Tier 1 visas were golden tickets for wealthy investors, who were able to purchase access to the UK,” said Tom Tugendhat, Tory chair of the committee. “The government must do its due diligence to investigate all individuals applying for visas, no matter the size of their bank account.
“Allowing illicit finance to fester has wide-ranging ramifications, corroding trust in our institutions and undermining national security.
“The UK’s status as a safe haven for dirty money is a stain on our reputation. The government must bring legislation in line with the morals of the British people and close the loopholes that allow for such rife exploitation.”