New research suggests the UK plays a far bigger role in global illicit finance than previously understood — and that could complicate Westminster’s plans to turn London into a leading crypto hub. What the report found - The Finance Innovation Lab estimates at least £325 billion of “dirty money” moves through the UK every year — equivalent to more than 10% of UK GDP. That sum covers funds linked to financial crime, money laundering, corruption, illegal trade and tax evasion. - When the UK’s crown dependencies and overseas territories (for example Jersey and the Cayman Islands) are included, the annual total rises to over £788 billion. - The study is believed to be the first comprehensive attempt to quantify cross-border illicit finance flows connected to the UK, drawing on cross-border data about tax evasion and financial crime to map the country’s international role as a hub for tainted capital. Why it matters for crypto policy - The findings arrive as the government delays its Illicit Finance Summit (originally due 23–24 June) until December, and while ministers push ahead with plans to boost London’s status as an international centre for crypto assets. - The Finance Innovation Lab and an all-party parliamentary group (APPG) on Anti-Corruption and Responsible Tax argue those plans should be paused. The Lab warned that expanding London’s crypto offering risks worsening money-laundering and hidden-market activity, arenas where crypto has increasingly been implicated. Calls for action - The report urges stronger enforcement and transparency measures. The APPG and the Lab want increased funding for investigators, including the National Crime Agency and the Serious Fraud Office, arguing the extra resources would likely pay for themselves through higher fines and asset seizures. - They also demand a crackdown on UK-linked tax havens and full transparency over the real owners of shell companies in overseas territories such as the British Virgin Islands. Voices from the report - Jesse Griffiths, a report author, said: “Rachel Reeves has described the UK’s financial sector as the ‘crown jewel’ of the economy. Our report shows that, all too often, it is in fact playing a central role in supporting illicit financial flows: harming our economy, taking money from our public services, and supporting crime.” - Phil Brickell, Labour chair of the APPG, added: “After years of inaction from previous governments it is time for us to become part of the solution, not part of the problem. It’s time to give our enforcement agencies the resources they need to crack down on the scourge of economic crime, and for key UK overseas territories to finally lift their veil of corporate secrecy.” Implications for the market - For crypto firms and investors watching London’s policy direction, the report raises the prospect of stricter enforcement, tougher transparency rules, and a slower rollout of pro-crypto initiatives if ministers heed calls to prioritise anti-money-laundering action and tax-haven reform. The Treasury was approached for comment. Read more AI-generated news on: undefined/news