Boris Johnson’s government is drawing up fresh legislation to crack down on “dirty money” held by Russian oligarchs because the bill being pushed through parliament won’t be enough, the home secretary has said.
MPs passed the Economic Crime Bill on Monday evening, after planned reforms moved up the government’s list of priorities following Russia’s invasion of Ukraine. It will now be scrutinised by the House of Lords.
However, Priti Patel revealed there would be a second, “follow-on” Economic Crime Bill in the next parliament session because ministers “cannot get all the measures in right now”.
It comes as the government vowed to stick to a six-month time limit for a new register of overseas entities, despite Labour claims it would give Russian oligarchs a “get out of London free” card.
Sir Keir Starmer’s party said the government’s plan would still give oligarchs linked to Russia too long to move money out of the UK, urging the government to bring the time limit down to just 28 days.
With the unamended bill having passed on Monday evening, lawyers are set to be given six months to record who ultimately benefits from the asset ownership of property and land that is registered. If they do not, it will be frozen and cannot be sold or rented out.
Ms Patel said the move will give the UK government “greater power and information to identify and investigate the illicit wealth of Russian criminals, their allies and their proxies”.
But the home secretary conceded there would have to be another bill “with further measures” because “we simply cannot get all the measures in right now”. She added: “We’ve focused on the ones that will have the greatest impact and the greatest enablement.”
Ms Patel said the second bill will “prevent the abuse of limited partnerships” and give the government “new powers to seize crypto assets from criminals”, as well as measures to give businesses more confidence to share information on suspected money laundering.
“We’re already drafting that legislation, and it will be brought forward as soon as we’re able to and can get time in the House,” she said.
Conservative MP David Davis also tried to push the government to go further – proposing an amendment that would help allow the government to pre-emptively freeze of assets of individuals in cases under “review”, rather than wait until sanctions are imposed.
Mr Davis said: “This bill should be targeting the Russian government and Putin and his henchmen themselves … We should not kid ourselves, this is not an economic crime bill, it’s an economic warfare bill and it’s a war liberal democracies cannot afford to lose.”
However, the government signalled it would not support the senior Tory backbencher’s amendment, despite significant cross-party support.
Business minister Paul Scully said the government was unlikely to accept any backbench or Labour amendments, but may revisit them when the bill moves to the House of Lords.
The government’s own amendments to the bill should help allow the UK to slap sanctions on individuals who have already been hit by EU or US sanctions, and reduce human rights protections in the sanctions regime.
Another part of the bill going through parliament will tie the government to publishing an annual report on the use of unexplained wealth orders (UWOs), which allow law agencies to confiscate criminal assets.
Branding the Russian president a “gangster”, Ms Patel insisted that the government was working to “root out the dirty money in our economy and importantly to hobble Putin and his cronies”.
Shadow home secretary Yvette Cooper told MPs Labour would help “speed through” the Economic Crime Bill, but insisted “many of those measures” should have happened years ago.
Earlier on Monday, Mr Johnson told a Downing Street press conference the Economic Crime Bill will “whip aside the veil of anonymity” used to obscure ownership of oligarchs’ mansions.
“You can no longer use a bogus company to conceal your ownership of a property,” the prime minister said.
The bill now moves to the Lords for further consideration before it gets passed into law later in March.
