London:

The people who buy and sell houses for the world’s wealthy have cast doubt on UK government plans to increase transparency in the London housing market in order to tackle corruption.

Prime Minister David Cameron said on Tuesday — while on an official visit to Singapore — that some properties were being bought with “plundered and laundered cash” and the UK should not be a “haven for corrupt money”.

He announced plans to publish information on property owned by foreign companies, and for a consultation on how to improve transparency in the property market.

Scotland Yard has investigated 144 property purchases worth £180m (Dh1.03 billion) in the past decade.

Three-quarters of properties whose owners are investigated for corruption are held through offshore companies — a way for owners to hide their identity — according to research published this year by anticorruption campaigners Transparency International.

But estate agents, lawyers and tax advisers said that Cameron’s transparency plans would run up against rules in the world’s biggest tax havens that are designed to obscure information about who owns the shell companies registered there.

James Quarmby, head of private wealth at international law firm Stephenson Harwood, said that Cameron’s idea of publishing a list of the companies that owned UK property would be “simply a duplication of existing public domain information: the word ‘gimmick’ comes to mind”.

That information is already publicly available through the Land Registry, Quarmby and others said.

“Unfortunately for the prime minister, he does not have the power to force Cayman, Panama and various other jurisdictions to publish data on the ultimate beneficial owners of companies incorporated in those jurisdictions,” Quarmby said.

In total, £122b of property in England and Wales is owned by offshore companies, with more than 100,000 property titles being registered to them. In the London borough of Westminster, 9 per cent of homes are owned through offshore companies based in secretive jurisdictions. In Kensington and Chelsea the figure is 7.3 per cent and 4.5 per cent in the City of London.

The National Crime Agency recently warned that foreign criminals are laundering billions of pounds by purchasing properties, pushing up house prices in the process.

But Mark Davies, an expert in offshore tax who runs his own consultancy Mark Davies & Associates, said the argument that offshore companies were being used for corrupt purposes was “simply not the case in the vast majority of situations”.

Davies also criticised Cameron’s “ridiculous presumption that criminals follow the rules”.

“If Big wants to hide laundered money by buying property through an offshore company that he owns [and] the rules change and he wants this to remain hidden, he will simply have someone else named as the owner of the property — who will know?” Davies said.

Roarie Scarisbrick, a partner at agency Property Vision which acts on behalf of prospective buyers, said the people he works for who buy through companies “are not criminals”.

“We always know who the ultimate beneficiary of the company is, as would their lawyer and the banker who set it up,” he said.

Estate agents who suspect money laundering may be involved in a transaction should report it to the National Crime Agency, Donald Toon, director of the NCA’s economic crime command, recently told the Times newspaper.

“You are at risk of committing a criminal offence if you do not do that,” he warned.

Mark Hayward, managing director of the National Association of Estate Agents, repeated the warning on Tuesday.

But several leading agents told the FT that they either never or rarely reported anyone they encountered. Some said that they regarded suspicious buyers as figures of fun rather than potential criminals.

Trevor Abrahmsohn is managing director of Glentree Estates, which has sold a number of properties on The Bishops Avenue in Hampstead, also known as “Billionaires’ Row”. He called such people “nudniks” — Yiddish slang for timewasters or pests.

“We just have a bit of a laugh,” he said. “We tell them to pull the other one because it’s got bells on.”

— Financial Times