The government have recently published a fact-sheet summarising the proposed reforms to Companies House identity verification procedures, as outlined in their White Paper published in February. The scope of the proposals extend to both new and existing company Directors, People with Significant Control (PSCs), and anyone else filing with Companies House.
The proposals aim to combat fraudulent appointments of directors and beneficial owners without imposing significant administrative burdens on companies. Individuals verifying their identity will be asked to provide a ‘primary identification document’, for example a passport or driving licence, and a photograph of their face. Technology will then be used to compare the two, and confirmation of verification should be received in minutes.
Individuals can elect to use an Authorised Corporate Service Provider (ASCP), for example a legal advisor or accountant, to complete the verification process on their behalf. There are conditions for doing so, in particular, the body chosen to verify that individual’s identity must already be registered with a supervisory body for anti-money laundering (AML) purposes, and have an existing obligation to carry out customer due diligence checks on all of their clients.
Although the new proposals have not yet come into effect, once they do, there will be a transition period to allow existing Directors and PSCs to comply with the new requirements. Those that fail to comply within the requisite period may face criminal or civil penalties. For newly incorporated companies, Directors’ identity will need to be verified prior to an application for formation being submitted. For PSCs of newly incorporated companies, again, criminal sanctions will be imposed if identify verification has not taken place within a short time following incorporation.
If you need advice in relation to the proposed reforms or feel that you will need assistance once they come into force, call us on 01484 821 500 or fill out our online enquiry form to request a call back.