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London at the heart of a £175bn money laundering scandal believed to involve Russian premier Vladimir Putin

London at the heart of a £175bn money laundering scandal believed to involve Russian premier Vladimir Putin

At first glance, there is nothing special about Churchill Court in Harrow.

With its nondescript brick buildings and gated car park tucked behind a railway line, it looks like many other office blocks dotted across modern Britain.

But this anonymous site on the outer edge of London is at the heart of a money-laundering scandal that allegedly stretches all the way to the Kremlin – and is threatening to overwhelm one of Europe’s biggest lenders, Denmark’s Danske Bank.

Churchill Court is the given address of Lantana Trade LLP, a secretive British company which was a major Danske client and is reportedly linked to Russian premier Vladimir Putin himself.

It is now claimed that the Estonian branch of Danske laundered as much as £175bn of toxic cash for companies like Lantana.

Lantana – which was a customer of Danske for 11 months – was a limited liability partnership (LLP), a type of British company which allows its real owners to hide who they are. 

It was registered to Churchill Court in Harrow – although the firm is not thought to have employed any staff there – and was officially owned by companies in the Marshall Islands and Seychelles, both seen as notorious tax havens.

The allegations have triggered a crisis that forced Danske’s chief executive Thomas Borgen to resign yesterday and sparked a criminal investigation in Britain – the National Crime Agency is investigating the activities of one of the LLPs served by Danske. 

And there are fresh calls for the UK to crack down on dirty money flooding our financial system.

Robert Barrington of campaign group Transparency International UK said: ‘Whilst the Government has made a series of announcements about cracking down on dirty money, the UK still offers an array of services which have been abused by those looking to hide their illicit wealth.

‘It’s time the Government took strong action to ensure British companies cannot be abused for criminal activity and there is greater confidence in the integrity of the UK company register.’

Lantana’s shady activities first came to light when Howard Wilkinson, head of markets at Danske in Estonia, started looking into some of the lender’s customers and was shocked by what he found.

He realised that Lantana had filed false accounts with British authorities, claiming it was a dormant firm doing nothing. 

In fact, millions of pounds a day were being transferred through Lantana’s bank account as part of a complex series of transactions consistent with money-laundering behaviour.

Further investigation suggested Lantana was linked to Promsberbank, a little-known bank in Podolsk, outside Moscow.

One member of this lender’s board was Igor Putin, the cousin of Russia’s president. A major shareholder was Alexander Grigoriev, a banker who is alleged to have ties to Russian intelligence.

After Danske carried out a preliminary investigation, its Estonia office was reportedly visited by two Russians, one of whom is said to have asked bank staff: ‘Do you really feel you can walk home safely at night?’

Wilkinson told Danske’s board in 2013 that British LLPs were the most popular way for shady customers in Estonia to shift money around. 

The Estonian branch handled cash on behalf of 15,000 foreign customers, and UK firms were the second-biggest client group within this number after Russians.

In blistering notes to bosses, Wilkinson warned that Danske had breached regulatory requirements, ‘behaved unethically’ and suffered ‘a near-total process failure’. 

But to begin with, his concerns were largely ignored – partly because the Estonian operation was a prized money spinner.

So when Wilkinson raised concerns, little was done. An audit team from Danske looked into the claims and the lender later decided to wind down the Estonian unit serving foreign customers – but no action was taken against those responsible and the alarm was not raised with the authorities.

Eventually a frustrated Wilkinson decided to go public. Danske launched a full internal investigation in 2017 and global anger mounted as the scale of the problem became clear.

A report by law firm Bruun & Hjejle this month revealed that £175billionn of toxic cash had flowed through Danske, making it one of the biggest money laundering scandals of all time.

Borgen, 54, was forced to resign but even this may not fully expose the true level of the debacle, as the law firm is a long-time partner of Danske and its conclusions have been dismissed as a whitewash by critics.

One source who had seen the raw data handled by Bruun & Hjejle said its conclusions had let the board off the hook.

European justice commissioner Vera Jourova said: ‘This is the biggest scandal which we have now in Europe.’

Source: https://www.thisismoney.co.uk

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