Press Release: The new Economic Crime Plan is welcome, but until the Government takes this problem seriously we will never crack down on dirty money

See full press release with supporting analysis here.

30th March 2023

Today the Government released its long-awaited second Economic Crime Plan, originally expected last year, setting out its 3-year strategy on how it intends to combat fraud, money laundering, illicit finance and international kleptocracies.

The Plan at last acknowledges the full scale of the UK’s dirty money problem and sets out the threat of economic crime to our economy and national security.

The All-Party Parliamentary Group on Anti-Corruption and Responsible Tax welcomes:

• The Government’s definition of kleptocracy and the development of a government-wide approach to tackling its impact on the UK economy.

• The Government’s commitment to introducing a new failure to prevent fraud offence in the second Economic Crime Bill.

• Government reassurance that Overseas Territories and Crown Dependencies will have a public register of beneficial ownership this year.

“We welcome the long-awaited publication of the Economic Crime Plan. But the real test in fighting the scourge of economic crime is in action, not words,” said Dame Margaret Hodge MP, Chair of the APPG on Anti-Corruption and Responsible Tax.

But the Plan kicks many policy proposals down the road, rather than committing to introducing change through the Economic Crime and Corporate Transparency Bill, currently in the House of Lords. Instead, the Government has ignored most proposed amendments, which would have gone some way in solving the issues set out in this Plan.

“The Government has the perfect legislative opportunity to fix many of the problems identified in its plan: The Economic Crime Bill. Yet Ministers are choosing not to act. They will be judged on what they do, not what they say,” continued Dame Margaret Hodge MP.

The Plan is also unlikely to deliver expected results without proper funding. Frustratingly, the current Plan does not appear to commit any new Government funding to the fight against economic crime, reheating the £400 million already committed in the2021 Spending Review. Half of this is not even Government investment, but comes from private sector contributions. The US recognises economic crime as a security threat and increased funding for its financial intelligence agency by 18% in the fiscal year 2023 budget, with a further 20% proposed for the following year. We should be keeping pace with our close allies, at the very least.

“As far as we can see, no additional funding has been allocated to the fight against dirty money. Until the Government puts money where its mouth is, the entire strategy is just smoke and mirrors,” added Hodge.

Overall, the Plan lacks ambition and leadership, most notably in the deafening silence on the appointment of an ‘anti-corruption champion’ to replace John Penrose MP, who left office more than 8 months ago.

“The Government must immediately appoint an anti-corruption champion and seize opportunities in the Economic Crime Bill for real, long-lasting change. We must reverse the flood of dirty money, and this can only be done through tough enforcement, full transparency and smart regulation” concluded Dame Margaret Hodge.