“I have a client,” said the tax lawyer with splayed finger tips connected, “and this client may or may not have deposited half a million pounds into a bank account in the Cayman Islands in the 1980s”. The room erupted with hearty laughs and knowing nods across the boardroom table. I was sat in a room — a lone immigration adviser — with tax lawyers and private investment bankers: the lawyers in pinstripes and Windsor knots, the bankers in blue with white shirts fresh out of the packet. I had never felt more like the bad guy in a Bond film.
Fast forward a few weeks and I am watching a former colleague secretly filmed in a Mayfair hotel room by an undercover reporter claiming to be a middle-man for would-be investors of Putin’s squirreled fortune AND Chinese military technology. I watched from behind a cushion as my former colleague bragged about how easy the Tier 1 (Investor) visa rules were to meet without fully disclosing the source of these ill-gotten funds.
I reached for my phone and checked his social media accounts — all deleted. I looked online for commentary from the immigration law sector, but didn’t find much. This could have been any number of lawyers speaking in this way, I thought, so the silence was unsurprising.
The firm that we had both worked for previously paid a small salary, but a generous commission made on the amount of money billed per month (or at least they did when I worked there). Ten investment visas a year could have netted this lawyer around £17,000 in commission. For many lawyers, the more we charge clients, the greater our own personal reward.
I watched this lawyer on TV with his pocket square and saw his eyes bright with the intoxication of money and the envy of a millionaire’s lifestyle — Mayfair hotels, fancy watches, expensive suits. When I went to such meetings, met such people, and came home to a tiny rented terraced house with a blocked sink and not enough money in the joint account for food and petrol for the rest of the month, it was a bitter pill to swallow. You want in.
Dispatches goes undercover to investigate the Golden Visa system that allows foreign millionaires to buy themselves British citizenship.— Channel 4 Dispatches (@C4Dispatches) July 21, 2019
WATCH: £2 Million Passport: Welcome to Britain – Monday at 8pm on Channel 4 pic.twitter.com/FHgFSubEtg
How do we square the linking of money to performance with maintaining really robust ethics? Every single company caught out by the Sunday Times and Channel 4 responded in the same way: we fully comply with our regulations. I understand that the firms would have been advised to provide a statement that in no way implicated them of wrongdoing, but what I feel is missing from a lot of law firms is a strong code of ethics promoted and rewarded from the top down. What would the response be to most lawyers walking into their bosses’ offices to tell them of their decision not to sign a big money client on account of ethics? MDs, CEOs, Managing Partners have to promote ethics and reward ethical actions in terms of sacrificing money for doing the right thing.
The second point on which I reflected was the reasons why we even have an investment visa programme. Around 4,000 Tier 1 (Investor) visas have been issued since 2010. Given the increase in the required level of investment from £1 to £2 million in 2014, this means total investment of about £5.2 billion over ten years, but almost entirely into government bonds. Meaning of that £5.2 billion, of which interest was earned for the investor, about £3.4 billion is still invested.
To put this into perspective, the UK’s national debt is currently around £1,800 billion. Cash generated by investment visas therefore represents 0.003% of that total debt and about 10% of the annual interest on that debt.
Recent rule changes aim to direct that money to better sources, such as shares in UK companies, with bonds no longer a qualifying type of investment. But a company listed on the London Stock Exchange, for which shares are available for lower risk, is inevitably going to be a multinational corporation with resources being spent overseas and tax residencies outside of the UK. £2 million of investments in companies such as Lloyds, Barclays and Centrica is not going to trickle down to Mr and Mrs Smith of Englandville, Englandshire.
Why not make investors directly pay to build schools or hospitals, or cover 100 nurses’ wages for a year? Why not ask them to subsidise railways and buses, pay for a quarter of a million people’s medical prescriptions, or pick up a million school dinners? Why not rename the investor programme the donor programme?
I need to make these comments anonymously, unfortunately, because of the impact they would have on my job. I’m still in debt, still in that tiny terraced house. I still even have a blocked sink!