Will the UK ever regulate rampant Companies House registration fraud?
The level of MLM company registration fraud taking place in the UK is such that, whenever you see a Companies House certificate paraded about as proof of legitimacy, save yourself some time and just assume the company in question is a scam.
I can’t recall the last time I came across a legitimate MLM company for review incorporated in the UK, and it’s been this way for years.
The primary reason for this is that UK Companies House incorporation appears to be entirely unregulated.
Anyone from anywhere in the world can pay the £12 GBP fee and register online. Punch in whatever personal details you want and within minutes you’ll have an official looking certificate to provide gullible victims with.
Earlier this week Companies House published a press-release boasting of their “first ever successful prosecution for false company information”.
Sounds promising. But are we going to see actual registration regulation or is this a one-off?
Perhaps the most startling aspect of Companies House’s “first ever prosecution” is the fact that it’s based on a law that came into effect in 2009.
That’s right, after nine years Companies House has successfully held one individual accountable for false company registration.
Hip-hip hooray?
Oh and it gets worse…
The company in question, John Vincent Cable Services Ltd, was incorporated by Kevin Brewer back in May, 2013.
Brewer listed former politician Vince Cable as the Director of the company because, well why the hell not?
A year later in May, 2014, Companies House struck the company off.
In 2016 Brewer incorporated Cleverly Clogs Ltd. This time he listed Baroness Neville-Rolfe and Ibrahim Aman as Directors of the company.
Aman was a completely made up alias but Lucy Neville-Rolfe, she was the Minister with responsibility for Companies House at the time.
To drive home a point, this is the equivalent of registering a company with the SEC and citing the current SEC Chairman and Donald Duck as its Directors.
Brewer’s Cleverly Clogs incorporation went through without a hitch. A week later through he filed termination documents for Aman and Neville-Rolf and appointed himself as the sole Director of the company.
Brewer appears to have done this of in his own accord, as Cleverly Clogs wasn’t voluntarily struck off until September, 2016.
Presumably sometime after September someone at Companies House became aware of Brewer’s conduct, and a year and half later he was prosecuted.
Brewer’s prosecution, which for some inexplicable reason Companies House seem awfully proud of, resulted in a £1,602 fine and Victim Surcharge of £160.
He was also ordered to pay £10,462.50 in legal costs – which hilariously dwarfs the actual penalty amount.
Not that Business Minister Andrew Griffiths seems to care.
This prosecution – the first of its kind in the UK – shows the Government will come down hard on people who knowingly break the law and file false information on the company register.
Companies House works hard to protect and continually upgrade the company register, identifying potentially criminal activities and working closely with law enforcement bodies to help bring those perpetrators to justice.
At a rate of one prosecution every nine years and hundreds of MLM scams generated Companies House certificates annually, it’s pretty obvious Brewer’s prosecution isn’t going to change anything.
By any stretch of the imagination, the enforcement track record of Companies House public servants would put even the laziest of snails to shame.
Meanwhile I can still create an account, pay the £12 fee and register whatever I want through whoever I want.
And unless I’m stupid enough to use the name of one of the UK’s precious Ministers, or add my actual name to the filing, nobody at Companies House will ever bat an eyelid.
What an absolute fail on all accounts.
Not really a fair article.
Normally Oz is dead on and completely accurate. But where the fuck does Oz think he has the right to discredit Donald Duck?
Everyone know Scrooge McDuck is filthy rich. While Donald is hot tempered and a questionable uncle to Hewie, Dewie and Louie, his business practices really should be off topic.
As for the U.K. registration system and the rest, fuck those cunts.
huh? donald is a waddling duck? i sort of heard he was more like a wandering cock?
heard he’s a spankingly friendly wanderer with many playmates?
omg why does this innocuous statement sound so wrong??!!
sheesh, back to topic!
Article makes one proud to be British.
Little wonder the English pimps like Sharon piggy James and Simon beaver face Stepsys have got away with fleecing people for so long. Shameful.
Here in the UK we’re very proud of being the sweet spot of corruption.
We’re honest enough that Russian and Chinese oligarchs can invest their billions over here, knowing that it won’t be confiscated by the state, but corrupt enough to accept their lucre, and not prosecute them for money laundering (as the US might).
We’re honest enough that a Companies House incorporation certificate is prized by scammers as their marks think “if it was a scam the UK wouldn’t have let them form a company”, but corrupt enough to take money from scammers for letting them set up shell companies.
I’m not sure Oz appreciates how difficult this balancing act is to get right.
We could stop the problem in this article easily. Firstly, place a line of text on all incorporation documents reading “This Is Not A Certificate Of Good Standing”.
Everybody who has any business reading an incorporation statement already knows what this means, but for the marks it may at least give them pause.
Secondly, require all directors and all persons exercising significant control to undergo standard anti money laundering procedures (same as if they were opening a bank account) at the point of filing an incorporation document or confirmation statement.
Anti-money-laundering can be processed electronically in 99% of cases and is a trivial cost for any small finance firm, let alone a government bureaucracy.
This would be trivial and would require little if anything in the way of new legislation. But we can’t risk losing our status as the sweet spot of corruption.
What if the Russians and Chinese went elsewhere? Who would fund our political parties? What would happen to London property prices? Be practical!
Vince Cable is still an MP. He lost his seat in 2015 but got back into parliament in the 2017 General Election.
As for Companies House, the Conservative government has vowed since it got back into power in 2010 to cut back on what it considers to be restrictive red tape.
So since 2012 or so the civil servants at Companies House haven’t made any checks on individuals registering companies.
This is one of the reasons why many people consider London to be the money laundering capital of the world.
Companies House has never made checks worth the name on individuals registering companies. All manner of scammers have been free to register companies since the year dot.
From Wikipedia:
4,000 doesn’t sound like many out of 6.8 million but I strongly suspect that 6.8 million includes a lot of duplication and ex-directors – there aren’t nearly that many company directors in the UK. And the 4,000 doesn’t include scammers and dodgy types not on World-Check’s database.
And it was a very conservative estimate – when they included near-matches they found 30,000 directors who were on the World-Check database.
Remember, this was in 2008, two years before the blues and the reds traded places in Parliament. It has nothing to do with red tape.
London has been the money laundering capital of the world since at least the end of the Cold War. When did Roman Abramovich buy Chelsea F.C. again? It certainly wasn’t after 2010.
Last week I had to provide a UK formations company proof of ID and address for both myself and the directors.
That’s a first. What in the hell is going on?
First I’m hearing of it. Don’t tell me Companies House is finally cleaning up its act…
There is a big difference between a fomations agent asking for KYC data and Companies House asking. Agents can be sued and need to know that they will get paid, be able to look responsible, etc, be insured. The UK government not so much
Virtually every day I am contacted and asked to join a program. When I research it I often find a UK registered company however when I then go to Companies House and search the Registration Number its either for a different business or in liquidation.
@Wilson: You’ve been contacted by some pretty lazy scammers then. For two tokens from the back of a cereal packet they could get their own active UK company with their own registration number, and then your research wouldn’t raise any red flags.
A much better research process would be to simply ignore people trying to push get-rich-quick schemes on you.