Foreign companies that have bought property in the UK and fail to comply with new anti-money laundering laws could face heavy fines and other criminal penalties, the government has warned.
Under legislation fast-tracked through the UK Parliament after Russia’s invasion of Ukraine, overseas companies that have acquired land in the UK had until Tuesday to declare their true beneficial owners.
It is estimated that 19,510 of 32,440 registered overseas organisations have declared their owners, suggesting more than a third have yet to do so, figures from the Department for Business, Energy and Industrial Strategy show.
Business Minister Lord Martin Callanan said those that missed the deadline could face investigation, possibly leading to prosecutions and restrictions on the sale of assets, and fines.
“There is nowhere for the criminals and corrupt elites to hide,” Lord Callanan said.
“We will be using all the tools at our disposal, including fines and restrictions, to crack down on foreign companies who have not complied.”
Under the Economic Crime (Transparency and Enforcement) Act passed last March, foreign companies must declare their beneficial owners on a new register of overseas entities.
The move was designed to prevent Russian oligarchs and other foreigners from laundering their “dirty money” through safe investments such as land and property in the UK.
Other legislation going through Parliament will give more powers to Companies House and the insolvency service with £20 million ($24.6m) to recruit new teams of intelligence and analytical experts.
The department said that Companies House was already assessing and preparing cases for enforcement action.
Companies House chief executive Louise Smyth said the creation of the register of overseas entities marked a “huge step forward” in the organisation’s role in helping to combat economic crime.
“We cannot be clearer in our message to these entities: if you ignored warnings and fail to register before the deadline, you will face consequences,” Ms Smyth said.
“This includes not only the prospect of restrictions on your land or property, but also a possible fine, prison sentence, or both.”