Theresa May set to ban secretive Scottish shell companies to halt flow of dirty Russian money

Their move comes after constructive pressure from the Scottish Government and a Westminster campaign led by the SNP and a three-year campaign of investigative journalism from The Herald.

READ MORE: Trail of loot from £1bn heist led to door of Scots shell firms

This newspaper has repeatedly exposed the use of the Scottish-based shell companies to move money anonymously through offshore tax havens and this week highlighted concerns that Vladimir Putin and his associates may now be using them to bypass Western sanctions.

The SNP has been at the forefront of putting political pressure on the Prime Minister to act.

Last night, Theresa May wrote to the party's Westminster leader Ian Blackford to arrange a meeting to “take things forward on SLPs”.

The Highland MP said he was very pleased the Conservative Government was at last determined to take measures to stop the flow of dirty Russian money.

He said it appeared the Salisbury nerve agent attack, in which former Russian double agent Sergei Skripal and his daughter Yulia were targeted, had “helped focus” the Prime Minister's mind.

He said: “The Prime Minister has told me she is happy to meet with me to discuss the matter in more detail, so that we can work on this together.

“I hope we can have an early opportunity to push through legislation, which we can all coalesce around and support.”

Asked if the Government was now on the same path as the SNP to ensure SLPs were banned, he replied: “Yes. That’s what they are indicating to us.”

READ MORE: Russia condemns Scotland's response to spy attack

It is understood Mr Blackford has been given private ministerial assurances that the days of secretive SLPs are numbered.

It is expected Mrs May will give more details about her Government’s crackdown on Monday when she gives an update to MPs on today’s European Council meeting, which will discuss what more actions EU member states can take against Moscow over its culpability for the Salisbury chemical attack.

Mr Blackford suggested the UK Government’s move had been a triumph for The Herald’s long-running campaign to expose the misuse of SLPs by organised crime gangs around the world.

“I would like to commend the work done by The Herald on SLPs," he said.

"We have been pushing the Government for some time on this with work started by[ex-MP]Roger Mullen and then taken up by Alison Thewliss[who represents Glasgow Central].”

At the weekend, Mr Blackford called on the UK Government to “hit the Kremlin in the pocket,” noting: “One SLP registered in Glasgow was used last year to transfer £160 million out of Russia.

“Yet this is just scratching the surface given it is only one of thousands of SLPs set up over recent years, which need not register for UK tax or provide financial reports if conducting business abroad.”

In the year to March 2016, 95 per cent of SLPs were set up by offshore tax havens.

READ MORE: Boris Johnson compares Putin’s World Cup to Hitler’s Berlin Olympics

The Herald has already revealed how SLPs were used to own sanction-busting ships running a blockade of Crimea imposed after the Ukrainian peninsula was invaded and annexed by Russia in 2014.

It also emerged that British ghost companies, including an SLP, had been used to help firms close to the Putin regime prop up the economies of two other breakaway regions of eastern Ukraine.

Pro-Russian separatists have controlled most of the provinces of Donetsk and Luhansk - and their rich coalfields - since 2014. Widely regarded as Kremlin proxies, the unrecognised Republics of Donetsk and Luhansk have relied on exports of coal and steel to stay afloat.

They can ship their product over the border with Russia to Rostov-na-Donu, Glasgow’s twin city, and from there to Turkey and elsewhere.

Last year it was reported that 1 million tonnes of coal was leaving the regions a month. Ukrainian authorities have begun a criminal investigation in to what they regard as “contraband”.

The move to legislate to ban SLPs came as the Russian Consulate in Edinburgh condemned Nicola Sturgeon for supporting the “unprecedented and flagrant provocation” by the British Government which has blamed the Russian state for the Salisbury poisonings.

While welcoming “the warm messages of support” from the Scottish people, the consulate general insisted the British Government had been seeking to use the incident to “seriously aggravate relations further in pursuit of its unseemly political ends”.

The consulate in Edinburgh said the Scottish authorities had “unequivocally” supported a “hostile standoff” with Russia.

In a statement released on Twitter, the Russian Consulate in Edinburgh said: “It is absolutely unacceptable and unworthy of the British Government to seek to seriously aggravate relations further in pursuit of its unseemly political ends, having announced a whole series of hostile measures, including the expulsion of 23 Russian diplomats from the country."

And it added: “It is with much regret we have to note that the Scottish authorities have unequivocally provided their full support to this hostile stand-off with Russia “We are receiving warm messages of support and consideration from many residents of Scotland and we want to thank them all profoundly.”

READ MORE: Trail of loot from £1bn heist led to door of Scots shell firms

Meanwhile yesterday, the war of words with Moscow over the Salisbury incident intensified with Boris Johnson likening Mr Putin to Adolf Hitler while the Russian Foreign Ministry questioned whether there was a nerve agent used at all and accused Britain of concealing evidence.

Appearing before the Commons Foreign Affairs Committee, the Foreign Secretary was challenged by Labour’s Ian Austin if he thought Mr Putin intended to use the World Cup “in the way Hitler used the 1936 Olympics”; as a propaganda exercise to “gloss over” Russia’s “gross human rights abuses”.

Mr Johnson replied: “Your characterisation of what is going to happen in Moscow, the World Cup, in all the venues, yes; the comparison with 1936 is certainly right. It’s an emetic prospect, frankly, to think of Putin glorying in this sporting event.”

He expressed “deep concern” as to how the travelling England fans would be treated at this summer’s tournament, which begins in June.

While the Foreign Office has so far stopped short of advising them not to travel to Russia, the Secretary of State made clear his department was monitoring the situation “very, very closely,” stressing how under Fifa rules Moscow had to guarantee the safety of England fans.

He noted how there had been 24,000 applications from England fans to attend the World Cup - well down on the 94,000 applications at the same stage of the Rio World Cup in 2014 – but, he added, this did “not mean we are not deeply concerned about how they may be treated”.

In Moscow, the Russian Foreign Ministry insisted his comparison of Mr Putin to Hitler was “unacceptable” and “unworthy of a top European diplomat”.

It described the Salisbury incident as a “blatantly framed illegal adventure” and accused the British authorities of hiding evidence.