Russian money in London

Russian money in London is the flow of capital from Russia to the United Kingdom since the dissolution of the Soviet Union which has had a noticeable impact on the London economy. Colloquially the impact of the capital flow is referred to as "Londongrad" and "Moscow-on-Thames".

History

Russian money has been prevalent in London since the dissolution of the Soviet Union in 1991,{{cite news |title=The rise and fall of Londongrad |url=https://www.economist.com/britain/2022/03/05/the-rise-and-fall-of-londongrad |newspaper=The Economist |date=5 March 2022 |access-date=6 March 2022 |archive-date=6 March 2022 |archive-url=https://web.archive.org/web/20220306030520/https://www.economist.com/britain/2022/03/05/the-rise-and-fall-of-londongrad |url-status=live }} following which many Russian oligarchs sought to invest their wealth in other countries.{{cite journal |last1=Guriev |first1=Sergei |title=The Role of Oligarchs in Russian Capitalism |journal=Journal of Economic Perspectives |date=Winter 2005 |volume=19 |issue=1 |pages=131-150 |url=https://pubs.aeaweb.org/doi/pdfplus/10.1257/0895330053147994 |access-date=15 May 2024}} British Government policy encouraged the flow of foreign capital into the United Kingdom, for example through the foreign investor visa routes, introduced during John Major's premiership in 1994, one-fifth of whose recipients since 2008 are Russian citizens. Additional funds flow to British overseas territories, commonly used as tax havens, such as the Cayman Islands and British Virgin Islands. The concept{{which|date=July 2022}} is commonly associated with the terms "Londongrad" and "Moscow-on-Thames".

Over £27bn is invested by Russian citizens in the United Kingdom. Amongst the investments are Premier League football clubs, Scottish country estates, and the Evening Standard.{{cite web |title=Five things we learned about Russians in the UK |url=https://www.bbc.co.uk/programmes/articles/183cmHs1NCzL61ghjRvgMJ/five-things-we-learned-about-russians-in-the-uk |website=BBC Radio 4 |access-date=17 July 2022 |archive-date=17 July 2022 |archive-url=https://web.archive.org/web/20220717014306/https://www.bbc.co.uk/programmes/articles/183cmHs1NCzL61ghjRvgMJ/five-things-we-learned-about-russians-in-the-uk |url-status=live }} Tate art institution was supported by Viktor Vekselberg and Peter Aven.{{cite web |last1=Sweeney |first1=Mark |title=Tate galleries cut ties with sanctioned billionaires after Ukraine invasion |url=https://www.theguardian.com/business/2022/mar/14/tate-galleries-billionaires-ukraine-invasion-us-eu |website=The Guardian |date=14 March 2022}} Alexander Mamut invested £100m to Waterstones bookstore chain after acquiring it in 2011 for £53m. According to its managing director James Daunt, the intervention saved Waterstones, which managed to make its first annual profit since 2008 in 2016.{{cite web |last1=Flood |first1=Alison |title=Waterstones bookshops bought by hedge fund Elliott Advisors |url=https://www.theguardian.com/books/2018/apr/26/waterstones-bookshops-bought-by-investment-firm-elliott-advisors-james-daunt |website=The Guardian |date=26 April 2018 |access-date=17 July 2022 |archive-date=29 January 2023 |archive-url=https://web.archive.org/web/20230129225149/https://www.theguardian.com/books/2018/apr/26/waterstones-bookshops-bought-by-investment-firm-elliott-advisors-james-daunt |url-status=live }} He later remarked that continued Russian ownership would've been "catastrophic" for the chain in 2022.{{cite web |last1=Johnston |first1=Ian |title=Waterstones turns new page as custodian of independent bookselling |url=https://www.ft.com/content/7a44695f-9fde-4a29-9564-f0cf01524165 |website=Financial Times |archive-url=https://archive.today/20220417135301/https://www.ft.com/content/7a44695f-9fde-4a29-9564-f0cf01524165 |archive-date=17 April 2022 |date=17 April 2022 |url-status=live}}

According to Transparency International, at least £1.5bn is invested into UK property by Russians "accused of financial crime or with links to the Kremlin".{{cite web |title=Ukraine crisis: How much Russian money is there in the UK? |url=https://www.bbc.co.uk/news/60348046 |website=BBC News |date=11 March 2022}} In 2018, following the poisoning of Sergei and Yulia Skripal, a report titled "Moscow's Gold: Russian Corruption in the UK" was published by the Foreign Affairs Committee.{{cite web |title=Moscow's Gold: Russian Corruption in the UK |url=https://publications.parliament.uk/pa/cm201719/cmselect/cmfaff/932/932.pdf |publisher=House of Commons Foreign Affairs Committee |date=15 May 2018 |access-date=6 March 2022 |archive-date=3 March 2022 |archive-url=https://web.archive.org/web/20220303132809/https://publications.parliament.uk/pa/cm201719/cmselect/cmfaff/932/932.pdf |url-status=live }} In 2020, the Intelligence and Security Committee said that the influence of Russian business was so deeply embedded in the British financial system that it "cannot be untangled".{{cite web |last1=Macaskill |first1=Andrew |last2=Belton |first2=Catherine |title=Londongrad tries to kick its 30-year Russian money habit |url=https://www.reuters.com/business/londongrad-tries-kick-its-30-year-russian-money-habit-2022-02-28/ |website=Reuters |language=en |date=28 February 2022 |access-date=2022-03-06 |archive-date=2022-03-01 |archive-url=https://web.archive.org/web/20220301071919/https://www.reuters.com/business/londongrad-tries-kick-its-30-year-russian-money-habit-2022-02-28/ |url-status=live }}{{cite web |title=Russia |url=https://isc.independent.gov.uk/wp-content/uploads/2021/03/CCS207_CCS0221966010-001_Russia-Report-v02-Web_Accessible.pdf |publisher=Intelligence and Security Committee of Parliament |date=21 July 2020 |access-date=6 March 2022 |archive-date=3 March 2022 |archive-url=https://web.archive.org/web/20220303164029/https://isc.independent.gov.uk/wp-content/uploads/2021/03/CCS207_CCS0221966010-001_Russia-Report-v02-Web_Accessible.pdf |url-status=live }}

Following the 2022 Russian invasion of Ukraine there was a political desire to take action against UK-based oligarchs. Unexplained wealth orders are expected to be better enforced and foreign investor routes{{which|date=July 2022}} scrapped. The Economic Crime Bill was also revived and it includes a register to improve transparency of ultimate land ownership, currently obscured through the use of shell companies.{{cite web |last1=Pickard |first1=Jim |title=Government brings forward bill to tackle UK's 'dirty money' |url=https://www.ft.com/content/b0bda4c4-def4-4816-9563-febba4834f28 |website=Financial Times |date=28 February 2022 |access-date=6 March 2022 |archive-date=1 March 2022 |archive-url=https://web.archive.org/web/20220301132739/https://www.ft.com/content/b0bda4c4-def4-4816-9563-febba4834f28 |url-status=live }} Reuters reported that some Russian citizens have been making ownership changes and consulting lawyers to shield their assets.

Russian money in London

History

See also

References

Further reading