FROM licensing barbershops to getting tough on rogue landlords – MPs hold UK’s first ever consultation on criminal High Street shops

A leading All-Party Parliamentary Group (APPG) has heard calls for the Government to take urgent action in 3 key areas to tackle the growing problem of money laundering and tax abuse through High Street outlets like vape shops, barber shops, mini markets and candy stores.

The first of its kind

The evidence came out of a major roundtable hosted by the APPG on Anti-Corruption and Responsible Tax bringing together experts from government, police, finance, regulators, trade bodies and more, for a major roundtable evidence-sharing session.

The two-hour discussion is thought to be the UK’s first ever consultation on this high-profile issue, which is damaging the retail sector up and down the UK. It was held in Westminster Hall in collaboration with the Royal United Services Institute (RUSI).

How to clean up the High Streets: three key new recommendations

The APPG heard that, in order to build on the progress already made in the Pride In Place initiative (which will give communities the power to veto dodgy shops) the national and local government, enforcement bodies and other partners need to focus on the following areas:

1. Boost funding to enforcement agencies and regulators, at least in part via frozen/seized criminal assets.
2. Take firm action to protect vulnerable people who end up staffing or acting as nominee directors for High Street money laundering outlets eg overseas students.
3. Improve communication and data sharing between enforcement agencies at both local and national levels, also between the public and private sectors.

Specific ideas which the APPG will be investigating included:

• A mandatory licensing or registration system for all hairdressers and barbers (regulation already exists in this area, but is currently only a voluntary requirement)
• Introducing greater penalties for those letting agents and landlords who, in order to maintain rental income/gain greater commissions, knowingly enable money laundering and tax abuse in their properties.
• Encouraging far wider use of the Companies Act, which gives enforcement agencies the power to wind up companies for a variety of reasons, including criminal enterprise.

“The next steps”

APPG member and former Chair Joe Powell MP said:

“The crackdown on dodgy shops across the country is something the public cares deeply about.

“Our high streets are being hollowed out by illegitimate businesses that often don’t pay the tax they owe, sell illicit goods and have links to serious organised crime. That has real consequences for those that play by the rules, and for communities fed up with seeing illegal activity in plain sight.

“Today’s meeting of all the main players involved in enforcement and prevention in Parliament was a big step forward in sharing the great work happening such as Operation Machinize’s raid on over 2700 premises, and identifying where gaps exist.

“I know the Government is committed to improving our High Streets, and tackling tax evasion and money laundering. We look forward to seeing action in the coming weeks to bring this about.”

The need for a cross-system approach

Kathryn Westmore, Senior Research Fellow at the Centre for Finance and Security at RUSI, said: 

“Criminals have been exploiting the UK’s high streets for too long. They exploit legitimate business structures to launder their illicit proceeds, generate criminal revenue and facilitate organised crime on our streets.

“The insidious nature of the threat demands a cross-system response and so today’s roundtable was a welcome step forward in considering a range of options to clean up our high streets.”