A front-page report in the London Evening Standard stated that at least £100 billion of London properties had been ‘snapped up’ over the past six years by ‘shadowy corporate structures’ based in four British ‘tax havens’ – Jersey, Guernsey, the Isle of Man and the British Virgin Islands.
The report also said that ‘a stampede of investment’ had pushed up London prices and in some cases were linked to money laundering and tax evasion, with property sales worth over £180 million under investigation by the Metropolitan Police as the likely proceeds of corruption.
But Assistant Chief Minister Philip Ozouf, who has ministerial responsibility for the financial services sector, said that Jersey was currently the only jurisdiction onshore or offshore to have a register of beneficial owners of companies registered with the Jersey Financial Services Commission.
Senator Ozouf said that this enabled the regulator to provide information directly to other regulators in cases where there was suspicion of money laundering or improper gains. ‘Jersey has zero tolerance of the improper use of corporate structures,’ he said. ‘We have had a register of beneficial ownership for the past 40 years. That has put us in a strong position.
‘There are legitimate reasons why Jersey companies hold assets overseas and this benefits the UK economy. When issues arise, we have a strong and co-operative track record.’
The Evening Standard report was based on freedom of information requests submitted by Private Eye magazine, which found that one in six homes sold in the most expensive boroughs of Westminster and Kensington & Chelsea over the last three years was bought by a company based offshore.
The total value (accounting for 23 per cent) was £8.25 billion, with an average price of £2.3 million, and the most popular location was the British Virgin Islands, followed by Jersey, Guernsey and Panama.
Commenting on the Evening Standard article, a spokesman for industry promoters Jersey Finance said: ‘There is nothing shadowy about corporate structures in Jersey. The legal owner is a matter of public record. Where that legal owner is a Jersey company, it is clear for everybody to see.
‘The UK, unlike some other jurisdictions, does not restrict foreign ownership of property, so there is nothing illegitimate about foreign individuals or companies owning UK land.’
Jersey Finance chief executive Geoff Cook added: ‘There are many perfectly legitimate reasons why Jersey is increasingly being used for property and infrastructure investment, driven by a global trend to use international finance centres not for tax planning purposes, but because of their strong case law, high quality of service and robust regulation.
‘In fact, the infrastructure and property investment done through Jersey is a net benefit to the UK, creating commercial developments, housing, infrastructure and jobs,’ added Mr Cook.
‘Claims that Jersey is being used for secrecy or questionable reasons are therefore wide of the mark and are based on a misunderstanding of the role Jersey plays.’
