Following Russia’s invasion of Ukraine, and resultant sanctions on President Putin’s oligarch elite, a spotlight has been firmly cast on the British capital and its complicity as a store for dirty money.
When Russia mounted its war in Ukraine in February 2022, Britain was one of the first Western allies to impose sanctions on the country.
As of May, those sanctions have reached over a thousand individuals and businesses seen to be fueling President Vladimir Putin’s war chest with ill-gotten wealth. That includes banks with total global assets of £500 billion ($613 billion) and oligarchs and their families with a combined net worth of £150 billion.
But behind London’s ban lies a shady relationship with Russian wealth that is anything but secret: A reputation for which it earned the nicknames “Londongrad,” the “London laundromat” and “Moscow-on-Thames” well before the war.
A home for dirty money
A December 2020 Home Office report found a “significant volume of Russian, or Russian-linked illicit finance channeled through the UK economy,” including on things like high-end U.K. real estate, private school fees, luxury vehicles, and sometimes as donations to cultural institutions.
“If you’re looking for somewhere safe to stash the proceeds of your nefarious activities, London’s a very attractive place to do it,” said Duncan Hames, director of policy at Transparency International.
Clamping down on corruption
Amid mounting international pressure, Britain is now seeking to salvage its reputation with a new clampdown on corruption.
In March 2022, the government introduced into law a long-awaited Economic Crime Act, increasing sanction powers and requiring foreign owners of U.K. properties to reveal their identities.
But will it be successful? And just how will London fare without its fix of forbidden finance? Watch the video above to find out.