Today, Russian Deputy Prime Minister Igor Shuvalov will be holding a meeting with the lawyers who help him keep his foreign property secret.
And plenty of similar crooks around the world will be holding the same kind of meetings.
The Prime Minister of the United Kingdom has announced new commitments by his country to fight corruption.
Point 1 in my translation: for the first time, all foreign companies that own or plan to acquire property in the United Kingdom will be required to disclose their true beneficial owners.
This is very important. After all, what is the first thing a crook in the government of a developing country does after making his first $10 million?
He buys a house or apartment in London. A reliable investment in his family’s future. He’s not actually going to invest in his home country, is he? What nonsense—his home country, Russia in our case, is for making money.
The simplest scheme is used to keep the real estate purchase secret: you set up an offshore company in a secretive jurisdiction, and then the offshore company buys the apartment.
That is exactly the scheme Shuvalov himself uses. In his disclosure filing, he writes that he rents his 500-square-meter apartment in a building on the Thames embankment, a five-minute walk from Westminster. But ACF (the Anti-Corruption Foundation) has shown in detail, with documents, that he is renting the apartment from his own offshore company.
It is simply that the Russian authorities do not want to acknowledge ACF’s evidence. Nor do they want to look for evidence of their own. And so it turns out that no legal claims could be brought against Shuvalov.
Now the situation will begin to change. Foreign companies own 100,000 properties in England and Wales, 44,000 of them in London. Soon everyone will be able to find out who owns this real estate. I think there are some surprises ahead.
Nothing even remotely like this legislation is on the horizon in Russia. Of course, buying apartments through offshore companies is less common here, but it does happen—see the case of “Rogozin’s apartment.”
A similar law that our country needs is ACF’s proposal to require disclosure of the ultimate beneficial owners of companies participating in government procurement. Officials award these state contracts to themselves and their relatives while hiding behind offshore companies.
The Russian government called our draft law “unrealistic.”
Well, two years ago people were brushing off the idea of disclosing the owners of London real estate too, saying that no one would ever go for it.