Foreign Affairs Committee launches ‘dirty money’ inquiry

• Inquiry: Responding to illicit and emerging finance
• Foreign Affairs Committee

This inquiry will explore the “significant challenges” to the global economy, which contribute to corruption and insecurity. These challenges include vast flows of dirty money across borders – which, as laid bare by the Panama and Pandora Papers, the UK and the Overseas Territories can play a role in facilitating. The inquiry will also consider fintech innovations, such as cryptocurrency and central bank digital currencies (CBDC), which raise fundamental questions about how the emerging global digital economy will work, challenging international norms and standards.

This inquiry is the first in the Foreign Affairs Committee’s new programme of work on the “rules-based international order”: the international laws, rules and standards that affect our daily lives.

Chair's comments

Chair of the Foreign Affairs Committee, Tom Tugendhat MP, said:

“The UK is at the heart of global finance, attracting investment from around the world and delivering considerable benefits to the British people.

“But the reality is that the channels of wealth have also been carrying corruption and crime through our markets. Since our 2018 report ‘Moscow Gold’, the Government has done little to address these dangers.

“Today, illicit finance and corruption are closer to home and now there are new threats to contend with. Dirty money is allowed to move beyond the reach of law enforcement and challenge the capabilities of regulators around the world. New technology is thwarting anti-money laundering efforts and sanctions enforcement, playing into the hands of authoritarian regimes.

“As a global financial centre, the UK is in a unique position to act and to protect against threats to the rules-based international order. Russia’s intimidation of Ukraine, and the pressure The Kremlin is putting on other European states, makes it clear we must act.”

Call for evidence

The Committee welcomes written evidence on the following points:

• What are the pressures affecting the global rules-based economic order and how might illicit and emerging forms of finance affect these?
  
  
• How effective are existing international governance regimes and other measures to tackle illicit finance, and what gaps remain?
  
  
• How effective are the UK’s sanctions regimes on corruption and human rights? How could sanctions be used to greater effect in countering illicit finance?
  
  
• What other measures beyond sanctions can counter illicit finance, including bilateral and multilateral approaches?
  
  
• What is the potential impact of new distributed ledger technologies and digital currencies (both cryptocurrencies and central bank digital currencies): • On illicit finance and money laundering?
  
  
• On the UK’s international relations and economic security?
  
  
• What steps has the Government taken to assess this potential impact and determine the most appropriate UK response?
  
  
• To what extent and how do hostile states use investment in and through UK-based businesses to further their strategic interests and build a platform for their values?
  
  
• How, and how effectively, does the FCDO co-ordinate with other UK government departments and agencies to respond to illicit and emerging finance? To what extent does the FCDO participate in multilateral forums such as the Financial Action Task Force?
  
  
• What skills and expertise does the FCDO need to respond to the challenges and where are these lacking? What skills on illicit finance has the FCO merger with DFID brought, and how are these skills being exploited?
  

Form of written evidence:

Submissions should be no longer than 3,000 words. The main body of any submission should use numbered paragraphs. Each submission should contain: 

• a short summary, perhaps in bullet point form;
  
  
• a brief introduction about the person or organisation submitting evidence, for example explaining their area of expertise or experience;
  
  
• any factual information from which the Committee might be able to draw conclusions, or which could be put to other witnesses;
  
  
• any recommendations for action by the Government or others which the submitter would like the Committee to consider for inclusion in its report to the House.

Submissions should be in malleable format such as MS Word (not PDFs) with no use of colour or logos. Submissions should be arranged in numbered paragraphs.

Guidance on submitting written evidence and data protection information is available here: Guidance on submitting written evidence.

Deadline for submissions

The Committee is asking for initial written evidence to be submitted through the Committee’s web portal by Tuesday 27 September 2022. 

We recommend that all submitters familiarise themselves with the Guidance on giving evidence to a Select Committee of the House of Commons which outlines particulars of word count, format, document size, and content restrictions.

Diversity

We encourage members of underrepresented groups to submit written evidence. We aim to have diverse panels of Select Committee witnesses and ask organisations to bear this in mind when we ask them to choose a representative. We are currently monitoring the diversity of our witnesses.

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