THE Scottish Government is considering a new criminal offence to help crackdown on organised crime exploiting Scottish Limited Partnerships (SLPs).
Previously an obscure corporate entity, SLPs have become increasingly popular with overseas criminals, as their owners can hide behind shell companies and avoid scrutiny and tax.
The Herald, using data from the Organised Crime and Corruption Reporting Network, this week revealed this week that SLPs played a key role in the £16bn Russian “Laundromat” money-laundering scheme.
Praising the Herald’s continued coverage, Nicola Sturgeon said she would look at a new possible offence of “vicarious liability” to punish those knowingly setting up SLPs for crooks.
Nicola Sturgeon
Responding to a question from Green MSP Andy Wightman on the issue at First Minister’s Questions, she said: “I pay tribute to [chief reporter] David Leask and his colleagues at The Herald for the excellent work that they have done to shine a light on such practices.
“We will continue to look at whether we can take action within our devolved powers to better tackle those issues. I will ask the justice secretary to consider that option [vicarious liability] as part of an overall look at the matter.
"We will not shy away from taking action using our own powers if we have the ability to do that.”
Background: The Moldova Connection, Ian Fraser and Richard Smith reveal SLPs involved in world's biggest ever bank heist
Although formed in Scotland for as little as £20, SLPs are ultimately regulated by Westminster legislation, and SNP MPs have been pushing the UK Government to close any loopholes.
Mr Wightman said later: “Six weeks ago I had a meeting with Michael Matheson, the Justice Secretary, to invite him to consider introducing a new criminal offence of vicarious liability for crimes committed by SLPs. This could be used to prosecute individuals and firms that incorporate SLPs where they are found to have been involved in criminal activity.
"Straightforward defences of due diligence would be available that would enable legitimate use of this vehicle by law firms whilst putting in place very intimidating sanctions for the unscrupulous vendors of SLPs that end up being used for criminal enterprises.
“I am pleased that the First Minister has agreed to include this option in a review of the situation, and I will continue to press for action.”
How Herald reported Scottish Laundromat links
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