Select committee: Foreign Affairs Committee
Recommendation 12
Second report - The cost of complacency: illicit finance and the war in Ukraine
Published 30 Jun 2022
Paragraph 30
Addressed to Foreign, Commonwealth & Development Office
Foreign Affairs Committee Responding to illicit and emerging finance All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Recommendation (the committee's words)
The primary reason for early ineffective action on sanctions was inadequate preparation and foresight by the leadership of the FCDO and consequent understaffing within the sanctions unit. The skillset of staff within the sanctions unit and the coordination between departments to understand the commercial environment are critical. We welcome the Government’s expansion of the sanctions unit. But policy effectiveness requires practical backing, sufficient resources and 26 The cost of complacency: illicit finance and the war in kraine the right capabilities, including the capacity to gather necessary intelligence to support designations. The Government should provide the sanctions unit with the necessary additional resources for the duration of the crisis. We recommend that the Government develops a professional sanctions cadre, to develop sanctions design and targeting as a recognised professional specialism. The UK is a global financial centre with access to this information; we should make better use of it.
From: Foreign Affairs Committee, Second report - The cost of complacency: illicit finance and the war in Ukraine (HC 168), paragraph 30, 30 June 2022
Government response
The government responded to the whole report on 26 October 2022.
Summary written by Accountability Index from the government's response. It is not the government's own words.The government says it is "not complacent about the threat" and, while it agrees with the Committee on several recommendations, it "notes" many others and rejects the Committee's call for public beneficial ownership registers in the Overseas Territories by early 2023.
- On Companies House reform, it "agrees with the Committee's conclusion" and says the reforms, including identity verification and broader Registrar powers, will be legislated for in the upcoming Economic Crime and Corporate Transparency Bill.
- On Overseas Territories and Crown Dependencies, it "does not accept" that work on public registers is delayed and expects them "by the end of 2023"; bringing the deadline forward to early 2023 "would not be achievable".
- On funding for law enforcement, it "notes this conclusion" and points to a package of "circa £400 million" to tackle economic crime over three years.
- On the Tier 1 Investor visa review, it "notes this recommendation", says the review "is being finalised" and that its aim is to publish it "in the near future".