Recommendation 17

Until April 2024, Companies House had limited powers to check the validity of information provided to it by registered companies. It also had limited enforcement and intelligence–gathering powers, and limited scope to share data with other public bodies. The lack of checks meant it was easy for fraudsters to set up legitimate UK companies for illegitimate means.48 Written evidence we received from RAVAS said that flaws in the verification systems operated by Companies House and HMRC have enabled bad actors to obtain UK company registrations and VAT numbers which can be used to pursue fraudulent behaviour.49 In its Strategic Intelligence Assessment, published October 2024, Companies House state that the number of company incorporations in the UK in 2021 and 2022 exceeded those around the world, with 758,751 UK incorporations in 2021 being 154% higher than the nearest country (Australia). Companies House’s data shows that UK incorporations in 2021 were 441% higher than in France, and 863% higher than in Germany in the same year. Companies House also say that the scale of abuse of the UK company register continues to grow.50