Question to the HM Treasury:

To ask the Chancellor of the Exchequer, for what reason the decision was taken to exempt Companies House from the requirements of anti-money laundering due diligence during company registration; and whether that decision was as a result of the statutory status of Companies' House.

This Government is committed to ensuring that the UK is a hostile environment for illicit finance. The UK’s anti-money laundering regime is based on risk to reduce the burdens placed on legitimate businesses. The EU’s 4^th Money Laundering Directive, which has recently been transposed into UK law, does not require national company registers to conduct due diligence upon companies at formation. Higher risk company formation activities in the UK will generally be done via Trust or Company Service Providers, who are subject to the Money Laundering Regulations.

Companies House employs systematic checks for accuracy, and has implemented a number of reforms to improve the quality of data. The most recent reform was adding a “Report It Now” feature in July 2017 to make it easier for users of the register to report any concerns with the data. While the function is relatively new, Companies House are receiving between 180-200 contacts a day through this service. Additional reforms underway include improved procedures to follow-up and cleanse redundant entries, and increased automation to reduce errors.

Maintaining one of the most open and extensively accessed company registers in the world – viewed over 2 billion times last year – is a powerful tool in identifying false, inaccurate, or possibly fraudulent information. Furthermore, the Government has a statutory obligation to review the operation of the People with Significant Control Register in 2019. This review will consider statistics on the operation of the register and evidence from the main users (law enforcement, obliged entities and civil society) and from the companies that supply the information.