Priti Patel is set to scrap the UK’s so-called golden visa scheme in a bid to halt the flow of “dirty money” flooding into the UK from Russia, according to reports.
The Tier 1 investor visas are effectively “golden tickets for foreign billionaires”, who can fast-track residency in the UK “in return for millions of pounds in business backing”, said The Sun. But the home secretary is expected to announced an immediate end to the scheme next week, “amid concerns London is flooded with cash and assets linked to Kremlin tyrant Vladimir Putin” and other Russian oligaths, the paper reported.
‘Londongrad’
Tensions over Moscow’s build-up of troops on the border with Ukraine have intensified “long-standing concerns” that the visa scheme, introduced by Labour in 2008, “had been exploited by those from hostile states”, said The Independent.
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Late last month, diplomatic sources told The Times that the US State Department had voiced “dismay and frustration” at the UK’s failure to crack down on the flow of suspect funds, especially in what they termed “Londongrad”.
According to the paper, American officials “fear that they will be unable to impose effective sanctions on President Putin if Russia invades Ukraine”, following “years of British tolerance” of such money being invested in the English capital.
“Putin doesn’t hold his money abroad,” a source in Washington said. “It is all in the kleptocrats’ names and a hell of a lot of it is sitting in houses in Knightsbridge and Belgravia right under your government’s noses.”
The government estimated in 2016 that around £100bn of corrupt money was flowing into the UK each year. In 2020, Parliament’s Intelligence and Security Committee said that oligarchs were drawn by “a light and limited touch to regulation, with London’s strong capital and housing markets offering sound investment opportunities”.
‘Send message to Putin’
The golden visa scheme was introduced by Labour back in 2008 in response to the financial crisis. Under the scheme, foreign nationals can get residency for themselves and their families by investing £2m or more in the UK.
A £2m investment into British businesses paves the way for an application to then get British citizenship and a passport within five years, shortened to three years for £5m, or two years for £10m.
According to the Daily Mail, more than 12,000 of the visas “doled out” so far, including 2,500 to Russians.
Critics have long warned that the scheme was being exploited to launder the proceeds of corruption, and to increase the influence of hostile states such as Russia and China.
Since 2015, applicants “have had to produce a letter from a UK financial institution confirming that they have opened an investment account”, said Spear’s Magazine. Further reforms were introduced in March 2019 “to protect better against financial crime and ensure that investments are of greater benefit to the UK economy”.
Earlier this month, the Financial Times reported that pressure was growing on the government to enact new legislation designed to tackle the problem. “Influential” Tory MPs had argued that the move was long overdue and would “serve to send a message” to Putin over Ukraine, the paper said.
Patel now plans to end the scheme entirely in a move linked to “a range of sanctions” being drawn up against Moscow, said the Daily Mail.
Russia’s Foreign Minister Sergei Lavrov warned yesterday that Moscow would “retaliate” if new sanctions were imposed by the UK.
