Law firms under pressure to improve safeguards against dirty money

Alison Thewliss MP, the SNP’s Treasury spokeswoman, said she is deeply concerned about law firms being used to assist in the laundering of “dirty money”.

She said firms should double check who uses their addresses. The Times reported that Russian railway magnate Alexey Krapivin controlled a Scottish Limited Partnership registered at Burness Paull’s office in Edinburgh.

Ms Thewliss pointed out that Companies House does not challenge firms on whether their filings are accurate when it comes to where they are based. She described this as a “gaping hole in the jigsaw of company regulation”.

“Whether or not Burness Paull knew about Krapivin using their address after they stopped taking money for their hosting service, they certainly should have checked after the service ceased and reported this to Companies House,” Ms Thewliss said.

“I would be curious to know whether they received any mail to the address and, if so, what they did on receiving this. Have they checked on other companies they used to host?

“The practice of legal firms hosting companies that they know nothing about is fraught with risk — particularly right now when some of these firms may be subject to sanctions.

“I believe that there is a responsibility for firms to check who they are hosting, and for the Law Society of Scotland to play its role as an anti-money laundering supervisor.”

She added: “I’m deeply concerned at what else might be going on under the cover of reputable legal organisations; it is clear that the flows of dirty money are assisted by professionals right here in the UK.”

The Law Society of Scotland said it is “acutely aware of the increased anti-money-laundering risk landscape, and the specific risks posed by SLPs”.

Peter Lawson, chairman of Burness Paull, said: “We are happy to meet Ms Thewliss and discuss any concerns she may have.”