Last year the prominence and potential scaled of this problem was highlighted with a $1billion fraud on three Moldovan banks, with a partnership central to the matter being based in a small flat in Edinburgh. Notwithstanding this it appears this trend is continuing and dozens of agents in eastern European countries are marketing Scottish Limited partnerships as the vehicle of choice. The nature of the partnerships, in particular the lack of information required to be disclosed about them and crucially the fact no tax is payable if activities are not based in Scotland (and is assessed on the partners themselves) naturally lends itself to individuals wanting to engage in crime or illegal activities. The partners of the Scottish partnerships are themselves often corporates registered in offshore jurisdictions which do not require any disclosure of any note.
Whilst there are no doubt many legitimate Scottish limited partnerships, it is clear something needs to be done to tackle something which has become a tool for crime, money laundering and bypassing international black listed (direct) dealings.
Crucially, the use of an SLP and a bank account in an EU country allows former Soviet "investors" the ability to bypass so-called blacklisted tax havens. Several former USSR states have banned direct contact with offshore zones. However, an SLP enables them to deal indirectly with jurisdictions such as Belize and Panama. That is because SLPs while registered in Scotland are often owned by "members", or partners, in the Caribbean. So the SLP is used to provide a financial bridge between the former Soviet Union and tax havens by, nominally, provided a corporate based in the respectable European Union jurisdiction. That SLP then opens doors to a bank account in another EU jurisdiction