Folkestone & Hythe Council’s Offshore Ownership Blind Spot

Some councils publish policies that look a bit stale. Folkestone & Hythe District Council appears to prefer the full museum experience.

Its public anti-money-laundering policy still points readers to the Money Laundering Regulations 2007 and to NCIS, an agency abolished in 2006. So anyone hoping for clear, up-to-date and confidence-inspiring guidance on how the council handles suspicious money in 2026 is instead handed something that reads less like a live governance document and more like an exhibit from the administrative Jurassic period. The law that actually applies is the Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017, and Suspicious Activity Reports are made to the National Crime Agency’s UK Financial Intelligence Unit, not to a long-defunct body from another era.

That would merely be funny if the subject were not serious.

Anti-money laundering is not just a City of London problem. It is not only for banks, hedge funds and men in glass towers saying “enhanced due diligence” over artisan coffee. It matters in district councils too, because councils handle land, regeneration, development partnerships and public money. While local authorities may sit outside much of the regulated sector, the criminal offences under the Proceeds of Crime Act still apply to everybody, including public bodies.

In plain English, money laundering means taking criminal property and helping it look clean. FHDC’s own policy says it is the process of moving illegally acquired cash through financial systems so that it appears to come from a legitimate source. It then lists the offences: concealing or transferring criminal property, entering into arrangements that facilitate its use, and acquiring or possessing it. It also lists two further risks that matter enormously in local government: failing to disclose suspicions, and “tipping off” somebody in a way that could prejudice an investigation.

So far, so sensible.

The trouble starts when the council explains how it identifies clients. In relevant cases, the public-facing procedure says officers should check the organisation’s website, conduct an online Companies House search and seek evidence of the key contact’s identity and role. That may work perfectly well for a straightforward British company with a straightforward British ownership chain. But once property, regeneration or development decisions touch offshore entities, layered ownership chains or trust structures, that checklist begins to look rather less like robust due diligence and rather more like a polite guess.

And this is not some abstract lecture about offshore finance happening a safe distance away in Mayfair.

As we have reported before, Hythe has already had its own very local brush with the problem of offshore ownership and opaque structures. Our 2018 reporting on Pensand House and Marlborough Court traced a long offshore thread running through the site’s history. According to the Land Registry material and planning documents cited in that reporting, the freehold land was bought in 1987 by Kenlee Ltd, an Isle of Man company, and the planning application submitted shortly afterwards gave a Guernsey address. The same reporting later said Chelsea Portfolio Limited bought Pensand House and Marlborough Court in 1996, and in a follow-up article we reported that lawyers acting for Chelsea Portfolio did not dispute the ownership structure we had set out for that year.

That matters here because it shows the issue is not theoretical. Offshore structures are not something that only happen in documentaries, on BBC investigations or in books about oligarchs and shell companies. They have appeared in real property stories in our own patch.

For the avoidance of doubt, and because this point matters legally as well as morally, nobody is accusing Mr Abramovich of wrongdoing in this article. We are not alleging he laundered money. We are not alleging he committed any criminal offence. Our own earlier reporting made clear that investigations do not imply guilt, and that we were raising concerns and ownership questions reported elsewhere, not making findings of criminality ourselves. That distinction is important and it stays important.

But the local governance question remains, and it is a perfectly proper one. If a council is dealing with land or property interests connected to offshore vehicles, how does it really identify the human beings behind them? How does it know who ultimately owns, controls or benefits from the structure? How does it satisfy itself about source of funds if the trail runs through places where beneficial ownership information is restricted, application-based, trust-shielded or not easily available to the public?

That is where the council’s front-facing policy starts to wobble.

Because the jurisdictions that appear in the district’s title picture do not all offer the same level of transparency. Jersey is not a total black box, but beneficial ownership access is still controlled and evolving. Guernsey is moving through a legitimate-interest model. The British Virgin Islands offers some company information publicly, but beneficial ownership access is more limited and director details are not simply laid out in the way a lay reader might assume. Liechtenstein has a beneficial ownership register, but access is by application through the Office of Justice. Panama’s register is closed. Seychelles requires beneficial-owner records to be kept with a resident agent. St Kitts and Nevis has legal frameworks and authority access, but not the sort of broad public search that lets a district council officer click once and see the whole human picture.

So when FHDC’s public policy implies that a website check, a Companies House search and a look at the named contact may do the job, it is not giving residents the full story. In cases involving straightforward domestic counterparties, perhaps that is enough. In cases involving offshore ownership, secrecy-linked jurisdictions or complex layered structures, it plainly is not.

That is why the wider dark-money reporting matters. Oliver Bullough has argued that the battle for transparency is not won because trusts still keep ownership hidden. Nicholas Shaxson has long made the point that the real attraction of secrecy jurisdictions is not just low tax but opacity and limited information-sharing. Richard Murphy has said much the same in different language: secrecy still matters because abuse still matters. And ICIJ’s Panama Papers investigation showed how offshore companies can be used to conceal assets, blur control and hide wrongdoing. Transparency International UK, meanwhile, says it has identified £11.1 billion of questionable funds invested in more than 1,600 UK properties since 2016, with £5.9 billion routed through shell companies in the UK Overseas Territories.

That does not mean every offshore owner is bent. It does not mean every foreign company is suspect. And it certainly does not mean every property linked to an offshore structure is tainted.

It means something more sober and more important: secrecy creates a visibility problem. And where there is a visibility problem, a council should not pretend certainty it does not possess.

This is why the UK’s own response has moved well beyond the sort of checks still implied by FHDC’s public-facing document. The Register of Overseas Entities was introduced precisely because ownership of UK property through overseas entities posed obvious transparency risks. Verification of beneficial owners has to be carried out by a UK-regulated agent supervised under the current anti-money-laundering regime. In other words, the national system already recognises that this is specialist work. It is not something solved by opening two browser tabs and hoping for the best.

The Dark Money Files makes the same point in a different way. Its whole existence is a reminder that this field is specialist terrain. Corporate due diligence, trusts, foundations and ownership chains are not side quests for generalists. They are technical disciplines. If you do not have the skillset in-house, the answer is not bluff. It is to bring in people who do.

And that is the heart of the matter for Folkestone & Hythe.

If the council is dealing with land transactions – which it is -, regeneration schemes, development partnerships or funding arrangements that involve offshore entities in jurisdictions such as the British Virgin Islands, Liechtenstein, Seychelles, St Kitts and Nevis, Panama, Jersey or Guernsey, then an out-of-date public policy and a Companies House search are not enough. The council should be saying so plainly. It should be using enhanced due diligence, proper source-of-funds checks, beneficial-ownership verification wherever possible, and outside specialist advice where the trail becomes opaque.

Anything less is not robust governance.

It is hope wearing a suit.

And hope, however smartly turned out, is not an anti-money-laundering strategy.

The Shepway Vox Team

Dissent is NOT a Crime