Russian money in London is the flow of capital from Russia to the United Kingdom since the dissolution of the Soviet Union which has had a noticeable impact on the London economy. Colloquially the impact of the capital flow is referred to as "Londongrad" and "Moscow-on-Thames". [1]
Russian money has been prevalent in London since the dissolution of the Soviet Union in 1991, [1] following which many Russian oligarchs sought to invest their wealth in other countries. [2] British Government policy encouraged the flow of foreign capital into the United Kingdom, for example through the foreign investor visa routes, introduced during John Major's premiership in 1994, one-fifth of whose recipients since 2008 are Russian citizens. [1] Additional funds flow to British overseas territories, commonly used as tax havens, such as the Cayman Islands and British Virgin Islands. [3] The concept[ which? ] is commonly associated with the terms "Londongrad" and "Moscow-on-Thames". [1]
Over £27bn is invested by Russian citizens in the United Kingdom. [3] Amongst the investments are Premier League football clubs, Scottish country estates, and the Evening Standard. [4] Tate art institution was supported by Viktor Vekselberg and Peter Aven. [5] Alexander Mamut invested £100m to Waterstones bookstore chain after acquiring it in 2011 for £53m. According to its managing director James Daunt, the intervention saved Waterstones, which managed to make its first annual profit since 2008 in 2016. [6] He later remarked that continued Russian ownership would've been "catastrophic" for the chain in 2022. [7]
According to Transparency International, at least £1.5bn is invested into UK property by Russians "accused of financial crime or with links to the Kremlin". [8] In 2018, following the poisoning of Sergei and Yulia Skripal, a report titled "Moscow's Gold: Russian Corruption in the UK" was published by the Foreign Affairs Committee. [9] In 2020, the Intelligence and Security Committee said that the influence of Russian business was so deeply embedded in the British financial system that it "cannot be untangled". [3] [10]
Following the 2022 Russian invasion of Ukraine there was a political desire to take action against UK-based oligarchs. Unexplained wealth orders are expected to be better enforced and foreign investor routes[ which? ] scrapped. The Economic Crime Bill was also revived and it includes a register to improve transparency of ultimate land ownership, currently obscured through the use of shell companies. [11] Reuters reported that some Russian citizens have been making ownership changes and consulting lawyers to shield their assets. [3]