Corporations Home has collected simply £1,250 in fines regardless of being handed new powers to sort out fraud and company abuse, prompting concern from MPs over the UK’s dedication to cracking down on financial crime.
The company, which maintains the official register of corporations within the UK, was granted new enforcement powers final autumn as a part of long-awaited reforms designed to forestall fraudulent enterprise registrations. Nevertheless, in response to a parliamentary query from Liam Byrne MP, chair of the Enterprise and Commerce Choose Committee, it was revealed that simply 234 penalties had been issued to date – with a complete worth of £58,500. Solely 2 per cent of that sum has really been recovered.
“Action to collect penalties will accelerate during summer 2025,” stated Justin Madders, a junior minister on the Division for Enterprise and Commerce. “Outstanding penalties will be referred to debt collection and litigation where appropriate.”
The information comes as Corporations Home continues to face criticism over its potential to forestall the misuse of UK company buildings. The company has turn out to be a goal for fraudsters and even pranksters, with bogus firm names resembling “Darth Vader” and “Santa Claus” beforehand accepted onto the official register.
Reforms at the moment being rolled out embody obligatory id verification for firm administrators and harder checks on helpful possession. These observe an admission from the company that as much as 20 per cent of the 4.9 million companies on its register could have submitted false or deceptive data.
Byrne, who has been a vocal critic of the tempo of reform, stated the minimal stage of enforcement undermines the federal government’s guarantees to wash up the UK’s company panorama.
“When up to 1 million companies are built on lies, it’s time for Companies House to get tougher,” he stated. “It’s not only a register – it’s the frontline within the conflict on financial crime.
“We won’t defeat fraud with warnings. We won’t clean up the system with good intentions. We need action. We need enforcement. And that means using the power to punish those trying to corrupt our economy, dodge sanctions or launder cash.”
Corporations Home stated the penalties had been a part of a broader technique and could be rolled out in phases. “Financial penalties are one sanction that is available to Companies House and is an important part of our overall enforcement,” a spokesperson stated. “Volumes will increase over time to address non-compliance. We have robust processes to pursue the payment of penalties, including taking court action where necessary.”
However issues persist over the company’s capability to implement reforms successfully. Byrne has warned {that a} 20 per cent emptiness charge in digital roles at Corporations Home could also be hampering its transformation plans, and that loopholes within the system proceed to be exploited for sanctions evasion and money-laundering – typically with the alleged help of UK nationals.
The revelations add additional strain on ministers and civil servants tasked with overhauling the UK’s enterprise registry, which has lengthy been criticised as one of many weakest hyperlinks within the nation’s financial crime defences.
