More than in any other country in Europe, London’s banking sector is big enough to aspire to be a home of clean money.
Yet the UK’s prestige, as well as its shops and schools, also make the country attractive to corrupt officials, oligarchs and criminals from around the world.
The very size of the financial sector can make illicit money even easier to hide.
Tens, possibly hundreds, of billions of pounds are laundered through the UK every year, according to the National Crime Agency.
Along with those from Russia, British Virgin Island and UK-based clients made up the biggest share of the non-resident portfolio in possibly the world’s biggest-ever money laundering scandal at Danske Bank in Estonia.
Last year, the UK gained an exceptionally glowing grade from the Financial Action Task Force (FATF), the multilateral body that monitors countries’ anti-money laundering frameworks – although anti-corruption campaigners criticized the report.
According to international campaign group Global Witness, it glossed over fundamental failings such as a lack of prosecutions against senior individuals.
Moreover, praise for the UK’s framework partly derives from its early adoption of common European standards on money laundering – and possibly its sway at the FATF (its secretary general, David Lewis, is British).
The UK has enjoyed particularly close information-sharing arrangements with other European law enforcement agencies, too, through Europol.
Now UK’s departure from the EU could make it harder for Brussels to encourage the continent’s biggest financial sector (and the UK’s overseas territories and crown dependencies) to act responsibly.
Such independence may be part of the attraction for Brexiteers. Yet the danger is that these territories, and the UK, become even more appealing to corrupt capital from the wider European region.
“There’s a strong sense that tackling economic crime is core to the long-term prosperity of the UK,” insists Alison Barker, director of specialist supervision at the Financial Conduct Authority, talking about the post-Brexit attitude of those in Britain who are responsible for preventing money laundering.
Part of the UK’s problem with money laundering is that single-market rules makes it harder to discriminate against flows from the rest of Europe, even when they come from member states with weaker money-laundering frameworks.
In the UK, eurosceptic prime minister Boris Johnson has confirmed the fears of anti-corruption campaigners over Brexit, with his plans to launch 10 new free ports, which are notorious magnets for money launderers where they exist in other states.
It is the sort of policy that leads campaigners to question the sincerity of efforts to make London less of a haven for ill-gotten gains from developing countries.
“You pretend to be improving, but if you leave a window open, the money will go through it,” says Andres Knobel, a Buenos Aires-based researcher at the Tax Justice Network.