SmartSearch: Survey reveals the UK’s money-laundering hotspots

A survey commissioned by AML software provider SmartSearch has revealed where the UK’s money-laundering hotspots are located.

If you’re a Russian kleptocrat who wants to launder money through the UK to help finance Putin’s war in Ukraine, do it in Northern Ireland.

New data has identified the province as the UK’s most vulnerable area for dirty money.

The region’s exposure to money laundering is revealed in a comprehensive, cross-sector survey commissioned by SmartSearch, the UK’s leading provider of anti-money laundering (AML) software and solutions.

Decision-makers in 500 regulated UK businesses across the legal, property and finance sectors were questioned on a range of AML compliance issues.

In Northern Ireland, almost three quarters (71 per cent) of those who responded had not changed their approach to onboarding new customers since sanctions were imposed on Russia after its invasion of Ukraine.

And even more (85 per cent) had not changed their approach to monitoring existing clients since the start of the war.

A report this year by the commons foreign affairs committee revealed that the government was still failing to tackle Russian kleptocrats who were laundering cash illegally through the UK – claiming that some of it was being used to finance Putin’s invasion.

Since the incursion, an unprecedented 7,200 individuals and 1,250 entities have been added to the thousands of sanctions already affecting Russia since the war in Ukraine began.

Other regions most vulnerable to money-laundering included the South-West and the West Midlands, where more than half (58 per cent) of the regulated firms who responded had not increased their checks.

Conversely, Wales was revealed as the part of the UK most likely to stop Russians laundering dirty money – nearly three quarters (72 per cent) of regulated firms in the country had increased checks on clients since the war began. Firms in London and Yorkshire were almost as vigilant, with more than one in six (63 per cent) upping their checks on new customers since the start of the war.

Martin Cheek

SmartSearch managing director Martin Cheek said:

“These shortfallings are a far cry from proper due diligence and it’s no wonder that criminals and kleptocrats are taking advantage of these loopholes to wash their money in the UK.

“Electronic verification (EV) is the only robust way to monitor new and existing clients – it can even retro-screen them. It is the most effective way for firms to show they have sought to avoid sanction breaches and the fines and reputational damage which come with them.”

The survey is the second in SmartSearch’s continuing Electronic Verification Uncovered campaign, which aims to make regulated firms aware of the dangers of relying on flawed, old-fashioned methods of identity verification.

For more information, please visit here.

Kindly shared by SmartSearch

Main photo courtesy of Pixabay