This blog post was originally published on the Global Witness blog and was co-written with my colleague Naomi Hirst.
In 2015 David Cameron issued a threat to the corrupt, declaring ‘London is not a place to stash your dodgy cash’.
In a bid to stop dirty money from being funnelled into the country through anonymously owned companies his Government promised to create a public register naming the real owners of all overseas companies that own UK properties.
But, despite making the commitment again in front of over 40 governments at the International Anti-Corruption Summit just last year, and in the face of widespread domestic support for making the UK property market more transparent, progress has stalled. We’re two years on and the register is nowhere to be seen.
But maybe the British government know better than us? Maybe after the tough talk at the Summit all the secret beneficiaries left the shadows and incorporated companies in plain sight. It’s possible, right…?!
To find out whether or not we were barking up the wrong tree, we joined forces with friends at Who Owns England? and Transparency International UK to look at the most recent Land Registry data.
Unsurprisingly, our analysis found that since the property register was promised, nothing has changed.
We are still in the dark about the 86,000+ UK properties that are owned by anonymous companies.
As initially published in The Times, our joint analysis found that:
Secret ownership of property in England and Wales remains virtually unchanged since 2015
The total number of properties owned by companies incorporated in secrecy jurisdictions remains virtually unchanged from late 2015, at 86,000 - suggesting the Government’s rhetoric has had little effect.
As was the case in 2015, 87% of all properties owned by overseas companies have an owner in jurisdictions which keep information about the real people behind the company secret.
Tens of thousands of properties are owned through companies incorporated in the highly secretive British Overseas Territories and Crown Dependencies
- 57,000 properties are owned by companies registered in British Overseas Territories & Crown Dependencies - including places like the British Virgin Islands, Jersey, and the Isle of Man.
Some of the most expensive UK property sales in recent years have been made via companies incorporated in secrecy jurisdictions
According to the Land Registry, the most expensive property owned by a company based in secrecy jurisdiction is 123 Buckingham Palace Road which is worth £215,399,999 and owned by a Jersey-based company.
The top 10 most expensive properties owned by companies in secrecy jurisdictions are worth over £1.5 billion.
The use of companies incorporated in secrecy jurisdictions to purchase property is increasing in some areas.
Since 2015 the London borough of Tower Hamlets has seen an 11% increase in the number of properties owned by companies incorporated by secrecy jurisdictions, meanwhile Greater Manchester has experienced a 10% increase.
Secret ownership of property remains especially high in the London boroughs of Kensington & Chelsea and the City of Westminster.
In the City of Westminster over 10,000 properties are owned anonymously whilst in the Royal Borough of Kensington & Chelsea the tally almost 6,000.
These new findings tell us that the need for a property register remains as strong as ever. And as we approach International Anti-Corruption Day, all eyes are on Margot James as Minister for Corporate Responsibility to fulfil the commitment the Government made to citizens and to leaders from around the world to get dirty money out of the UK property market.
Reproduce our analysis
For those wanting to reproduce our analysis, expand upon it or understand more about our approach, the code is available as a Jupyter notebook via Github. The Land Registry data (accurate as of October 2017) that we used for this analysis has now been published freely, but you will still need to go through the steps to download it in order to reproduce our analysis.
- These findings are based on the Land Registry’s Overseas Ownership Dataset as initially received and processed by Global Witness. This dataset is now available free of charge at https://www.gov.uk/guidance/hm-land-registry-overseas-companies-ownership-data
- “Secrecy jurisdiction” is a term used as an alternative to the more widely used term tax havens. These jurisdictions use secrecy to attract illicit and illegitimate or abusive financial flows. This analysis deems any jurisdiction with a “financial secrecy score” of 60 and above in the Tax Justice Network’s Financial Secrecy Index to be a secrecy jurisdiction.