Northern Ireland vulnerable to Russian money laundering

Russians looking to launder money in the UK would have the easiest time in Northern Ireland, anti-money laundering firm SmartSearch has warned.

In Northern Ireland, almost three quarters (71%) of businesses haven’t changed their approach to onboarding new customers since sanctions were imposed on Russia after its invasion of Ukraine.

And the vast majority (85%) have 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.

Martin Cheek, managing director of SmartSearch, 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.”

Other regions most vulnerable to money-laundering included the South West and the West Midlands, where more than half (58%) 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%) 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%) upping their checks on new customers since the start of the war.

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