UK Government Gets Tough on Sanctions Evasion, Fraud and Money Laundering in Newly Published Economic Crime Plan
The UK government has published a new Economic Crime Plan focused on combatting kleptocracy, cutting fraud, and reducing money laundering. The second plan, which builds on the first published in 2019, is a bold and ambitious three-year strategy aimed at strengthening criminal enforcement to tackle these issues head-on.
Sanctions evasion is a top priority, and the UK government has committed to improving the design, implementation, and enforcement of financial sanctions. It also plans to enhance information-sharing between supervisory bodies to combat violations and expand the enforcement guidance of the Office of Financial Sanctions Implementation (OFSI). The government aims to strengthen the operational and international response to kleptocracy, working with agencies around the world to target specific individuals and assets.
Fraud is also a major concern, accounting for 41% of all crime experienced in the UK in the year ending September 2022. The new plan seeks to modernise responses and reduce the impact of fraud against the public sector. The Public Sector Fraud Authority (PSFA) established under the plan is tasked with ensuring ministerial departments and public bodies understand and take action on fraud against the public sector. The plan also notes that wider economic crime reforms and infrastructure will have an impact on tackling fraud.
Finally, the government is targeting money laundering through an Economic Crime and Corporate Transparency Bill, which aims to limit the abuse of corporate structures. The bill also includes a groundbreaking proposal to introduce a new offence of ‘failure to prevent fraud’ that would hold organisations accountable if they profit from fraud committed by their employees.
Related Facts:
• UK government officials estimate that £90 billion is laundered through the UK each year.
• The National Crime Agency (NCA) recorded a 55% increase in suspected money laundering cases between 2017 and 2020.
• The Public Sector Fraud Authority (PSFA) has a budget of £25m and will have around 200 staff.
Key Takeaway:
The UK government’s Economic Crime Plan 2 is an ambitious strategy aimed at combatting kleptocracy, cutting fraud, and reducing money laundering over the next three years. With strong commitments to improving sanctions enforcement, targeting kleptocrats and corrupt individuals, and modernising responses to fraud and money laundering, the plan sets out a roadmap for strengthening criminal enforcement to tackle economic crime head-on.
Conclusion:
The publication of the UK government’s Economic Crime Plan 2 is a welcome development in the fight against economic crime. By committing to stronger criminal enforcement and targeting kleptocrats, fraudsters, and money launderers, the plan demonstrates a clear determination to maintain the UK’s reputation as a safe and transparent place to do business. While the path ahead is likely to be challenging, the government’s ambitious strategy suggests that progress is possible. It will be interesting to see how these policies are implemented and what impact they have in practice.
