UK house prices inflated by foreign criminals by laundering billions via luxury properties

UK house prices are being boosted by foreign criminals, who purchase expensive properties spending billions of pounds for the purpose of money laundering, according to the National Crime Agency (NCA).

Donald Toon, director of the economic crime command at the agency, told the Times that he was alarmed by the number of homes registered to complex offshore corporations, some of which might have been bought with laundered money.

Toon noted that his claim was supported by the fact that the Treasury had received £150m (€212m, $233m) in the past three months from a tax on properties purchased by companies, trusts and investment funds. The amount compared to £100m raised from 3,990 purchases in 2013/14, when the tax came into effect.

"I believe the London property market has been skewed by laundered money," Toon was quoted as saying by the newspaper.

"Prices are being artificially driven up by overseas criminals who want to sequester their assets here in the UK."

Toon also urged real estate agents to report any suspicious activity, when dealing with customers.

"If they (estate agents) have a suspicion that there may be money laundering involved then they absolutely should be submitting a suspicious activity report. You are at risk of committing a criminal offence if you do not do that," he said.

Toon's comments come as foreign investors are increasingly purchasing properties, especially in London, due to their safe-haven status. The number of foreign investors, mostly from Russia and Asia, purchasing premium properties in the British capital has surged over the last decade.

Hundreds of billions of pounds are laundered in London every year, according to the NCA, which said it was intensifying investigations.