'Pandora papers' show London is a key hub for tax avoidance: Report

Transparency advocates are calling on Britain to tighten the countrys defenses against money laundering and tax avoidance after a massive leak of financial data showed how London is a key destination of choice for some of the worlds richest and most powerful people to conceal their cashThe cache of almost 12 million files shows how wealthy people around the world reportedly set up offshore companies to buy property and avoid taxesForeign individuals identified as beneficiaries of these types of offshore accounts in London include Jordanian King Abdullah II Azerbaijans President Ilham Aliyev and associates of Pakistani Prime Minister Imran Khan Abdullah has denied any impropriety and Khan tweeted that his government would investigate anyone mentioned and take appropriate action if wrongdoing is found Aliyev hasnt commentedThe leaked financial data dubbed the ldquoPandora Papersrdquo was published Sunday by the International Consortium of Investigative Journalists and its media partners including Britains Guardian newspaper and the BBCThough the purchases are legal under British law they highlight the complicated mdash and often anonymous mdash financial practices wealthy individuals use to avoid tax far removed from the everyday experience of most of the British populationLondon is a goto for the rich and powerful because its home to a sophisticated ecosystem of businesses that can help in the process including creative wealth management firms highend lawyers and longestablished accounting firmsA 2019 analysis by transparency group Global Witness indicated that around 87000 properties in England and Wales were owned by anonymous companies registered in tax havensAlso ReadPandora Papers Sachin Tendulkar Shakira among those linked to offshore assetsIt said that 4037 of the anonymously owned properties identified were in London and that the total value of the properties was likely to be more than 100 billion pounds 135 billion Popular areas were said to include the boroughs of Westminster where the UK Parliament is located Camden and Kensington and ChelseaThe London property market has for years struggled to shake off a reputation for playing a central role in how rich people around the world seek to hide and accentuate their wealth with many prime properties in the heart of the city owned by nonnationals Russian oligarchs have been highprofile purchasers of London properties in recent years for exampleFor decades authorities in the UK have pushed a light touch approach to regulation in order to attract foreign capital and talent Critics say that has been a magnet for tax avoidance which can be legal as well as more criminal activities including money launderingDuncan Hames policy director at the campaign group Transparency International UK said the disclosures should act as a ldquowake up callrdquo for the government to deliver on longoverdue measures to strengthen Britains defenses against what he termed ldquodirty moneyrdquoldquoThese leaks show that there is one system for corrupt elites who can buy access to prime property and enjoy luxury lifestyles and another for honest hardworking peoplerdquo he said ldquoOnce again Britains role as an enabler of global corruption and money laundering have been exposed with the same loopholes exploited to funnel suspect wealth into the countryTransparency International UK is urging the government to close a loophole that allows companies in the UKs offshore financial centers such as the British Virgin Islands and the Cayman Islands to hold property in the country without requiring these companies to reveal the names of their true ownersIt also wants the government to crack down on professionals that help those with illicit wealth move and hide their cash in the UK and to properly resource the National Crime Agency to go after those suspected of having made their money through crime and corruptionTreasury chief Rishi Sunak said Britains tax authorities will inspect the Pandora Papers He defended the countrys record on tackling tax avoidanceldquoI dont think it is a source of shame because actually our track record on this issue is very strongrdquo Sunak told BBC radioHe pointed to measures taken over the past decade by the Conservative government to improve transparency mdash who owns what mdash and exchange data between tax authoritiesldquoAs youve seen from the papers it is a global problem theres a global dimension to it and we need other countries to cooperate with us to tackle this but we are determined to do that he addedSunak also said there is ldquoalways more we can dordquo when he was asked about reports that half of all Russian money laundering is estimated to occur in the UKOpposition parties said the revelations which also raised questions over donations given to the Conservative Party needed to be acted on urgently by the UKs Conservative governmentldquoThe tentacles of dark money exposed by the PandoraPapers reach into the heart of UK democracy Labour Party foreign affairs spokesperson Lisa Nandy said in a tweetThis story has been sourced from a third party syndicated feed agencies Midday accepts no responsibility or liability for its dependability trustworthiness reliability and data of the text Midday managementmiddaycom reserves the sole right to alter delete or remove without notice the content in its absolute discretion for any reason whatsoever