British lawmakers launch inquiry into economic crime

LONDON (Reuters) - British lawmakers are launching a fresh investigation into how the country is tackling crimes such as money laundering and terrorist financing after a report that billions of pounds of proceeds of crime are flowing into British property.

The cross-party Treasury Committee said on Thursday it would also scrutinise the scale and nature of economic crimes faced by consumers, such as scams, how effectively financial companies can combat them and how secure customer data is.

The Office of National Statistics (ONS) has estimated there were 3.2 million frauds in the year to last September.

"Given the threats that face the UK, the effectiveness of the regimes that we use to protect our financial system from misuse have never been more important," said Nicky Morgan, the chair of the committee.

The committee wants to grapple with the scale of money laundering, terrorist financing and sanctions in the UK, the current regulatory and legislative landscape and how people, companies and the wider economy are impacted by these regimes.

It is calling for written evidence by May 8 and will announce who it will call for questioning after that.

It is unclear how much money is laundered through Britain in total, but the National Crime Agency (NCA), a UK prosecutor, has said calculations of 36 billion pounds to 90 billion pounds ($50 billion-$127 billion) are "a significant underestimate".

Investors from Russia, China and the Middle East have poured billions into London, buying everything from luxury properties to entire companies, but the source of some of those funds has been questioned by transparency campaigners.

Transparency International, an anti-corruption group, says it has identified 4.4 billion pounds ($6.2 billion) worth of property in Britain that was bought with suspect wealth.

Britain has said it will use new powers, called unexplained wealth orders (UWO), to seize the UK assets of foreign criminals and corrupt politicians and clamp down on dirty money washing through London, in particular.

The NCA said in February it had secured UWOs to investigate two properties worth around 22 million pounds it believed were ultimately owned by a "politically exposed person" - someone holding, or close to those holding, prominent public positions.

Property can be seized if owners cannot explain the source of funds used to buy assets. False or misleading statements can lead to a fine or two years in jail.

(Reporting by Kirstin Ridley; Editing by Mark Potter)