A new report warns that the UK is a major conduit for illicit finance — and the scale could complicate the government’s push to turn London into a global crypto hub. Research from the Finance Innovation Lab estimates at least £325bn of “dirty money” flows through the UK every year — a sum equivalent to more than 10% of UK GDP. When crown dependencies and overseas territories such as Jersey, the Cayman Islands and the British Virgin Islands are included, the annual total rises to more than £788bn. The charity says this is the first comprehensive attempt to quantify cross‑border flows tied to financial crime, money laundering, corruption, illegal trade and tax evasion that are linked to the UK. The findings land as ministers delay the Illicit Finance Summit from June to December. They also feed into an intensifying debate about whether expanding the City into an international hub for crypto assets risks amplifying the problem. The Finance Innovation Lab urges a “pause” on the government’s crypto plans, warning that digital assets are increasingly implicated in money laundering and opaque market dealings. Jesse Griffiths, one of the report authors, said the research shows Britain’s financial sector — described by some politicians as a “crown jewel” — can also play a “central role in supporting illicit financial flows,” siphoning money from public services and enabling crime. The all‑party parliamentary group (APPG) on anti‑corruption and responsible tax backs the Lab’s recommendations, calling for a boost in funding for investigators such as the National Crime Agency and the Serious Fraud Office. The APPG argues that better resourcing would likely pay for itself through larger fines and more asset recoveries. Tackling secrecy in overseas territories is another key demand: the report calls for full transparency over the true owners of shell companies in jurisdictions that attract anonymous capital. Phil Brickell, Labour chair of the APPG, said the UK must stop being “part of the problem” and give enforcement agencies the resources to “crack down on the scourge of economic crime.” The government responded by pointing to its December anti‑corruption strategy and saying it is recruiting an extra 5,500 compliance officers to tackle tax evasion. Officials also noted that new crypto regulations are intended to bring the sector into the UK’s regulatory domain by 2027. For crypto industry watchers, the report raises a core tension: preserving the City’s competitive edge in fintech and digital assets while guarding against turning London into an even bigger magnet for illicit capital. Policymakers now face pressure to show how plans for crypto growth will be reconciled with the wider task of plugging the UK’s sizeable exposure to dirty money. Read more AI-generated news on: undefined/news