Crackdown on Tier 1 Investor Visas: UK Government’s Response to Money Laundering Concerns
As far back as November 2015, we covered a the Transparency International‘s report, which criticized the apparent vulnerability of the UK’s Tier 1 Investor visa scheme. It was suggested that substantial amounts of corrupt wealth stolen from Russia and China have been laundered into the UK using this visa category.
At the time, the UK’s government accepted that its anti-money laundering system had “significant weaknesses in its supervisory structure and in terms of the level of compliance and reporting standards across relevant private sectors.” The then Prime Minister, David Cameron, promised to tackle this issue and although a number of policy measures have been proposed, including to abolish the visa category altogether, no major changes have been introduced to remedy the situation until the Unexplained Wealth Order came into force on 31 January 2018.
The Unexplained Wealth Order allows the UK’s enforcement agencies to investigate and freeze assets of individuals suspected of having obtained them illegitimately. The National Crime Agency has so far secured only two such orders (accompanied by freezing injunctions) against two properties valued at a total of £22 million, which were believed to have been acquired using suspicious wealth by politically exposed persons.
Following the highly controversial nerve agent attack on the former Russian spy on the UK soil and despite the Government’s assurances that it has “no dispute with the Russian people”, the Secretary of State, Amber Rudd, has confirmed that she ordered the Home Office to retrospectively review the Tier 1 Investor and Entrepreneur visas issued to Russian nationals from 2008 to 2015. In addition, Prime Minister, Theresa May has publicly stated that there is “no place” for corrupt Russians in London and further confirmed that the enforcement agencies will be looking into wealthy Russians and demand that they account for their wealth (suggesting use of the newly introduced Unexplained Wealth Orders against such individuals).
In addition, perhaps even more troubling is the fact that it is now being suggested that the Home Office will be closely scrutinizing all Tier 1 visa extensions and Indefinite Leave to Remain applications from that categories by Russian nationals.
Although we are yet to see if the Home Office will implement this as a blanket approach to all Russian nationals, such measures are in any event very likely to lead to a higher number of refusals for genuine applicants. We therefore strongly recommend that individuals in these categories seek professional advice and assistance in good time before making any application.
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