Session 4 For the record

2. Lynn Lynch
Marketing Director

3. Fraud and the Register …...
and future plans for combating fraud and
improving compliance

4. Presentation
• Overview of Companies House
• Fraud facts and prevention
• Compliance issues
• What the Company Law Reform Bill will
mean for improving compliance and
preventing fraud

5. Companies House
• Companies House is an Executive Agency
of the Department of Trade and Industry
• Trading Fund with a turnover of £57 million
• 1,200 staff
• Live register - 2.0 million companies
• Growing at 140,000 companies per year
• 13,200 PLCs
• Register 7 million documents this year
• Image database approx.
60 million images
• 30 miles of paper files

7. Fraud
Facts and Figures:
–Measured since 2002
–Approximately 50 cases a month
–Over 500,000 standard filings a month
(0.01%)
–1 case could cost £1m.

8. False Filing Cases
May 02 - Jan 06
0
20
40
60
80
Jan-02
Jan-03
Jan-04
Jan-05
Jan-06

9. False Filing Cases
33%
28%
12%
10%
8%
0 % 5 % 1 0 % 1 5 % 2 0 % 2 5 % 3 0 % 3 5 %
Officer appointed
without consent
RO changed wthout
consent
Address used without
consent
Warring directors
Officer resigned without
consent

10. Fraud
• Key Areas
–Company Hijacks
–False Appointments
–False Auditors
–False Financial Information
–Similar named companies
–Copying signatures on the CH record
–Non-regulation of company formation
agents

11. Fraud - press coverage

12. Fraud - what are we doing to prevent
it?
• Focus on Hijack
• Operation Sterling
• Police Liaison Officer on site
• Home Office Identity Fraud Steering Group
• Work with others - OGD’s and credit
reference agencies

13. Fraud - prevention cont….
• Crime analysis
• Evaluate electronic validation options
• Company Law Reform changes
• Marketing activity
• 3 Point plan

14. our 3 point plan to
prevent identity fraud
1.Electronic Filing
3. Monitor
2.PROOF

15. Electronic filing
safe and simple
a secure system for the quick and easy
online submission of company information
STEP 1

16. PROOF
PROtected Online Filing
STEP 2

20. Monitor
STEP 3
Get the bigger picture

21. Company Law Reform Bill - helping
prevent fraud?
• A company can agree to file documents
electronically - PROOF will be on a
statutory basis
• It will be an offence to deliver false,
misleading or deceptive documents
• Registrar has the power to resolve
inconsistencies on the register
• Unique identifiers for directors

22. Compliance

23. Compliance issues
• ‘Soft compliance’ -
public target 92%, actual 91%
• ‘Hard compliance’ -
85% for accounts, 65% for annual returns
• Habitual offenders
• Marketing campaigns
• Company Law Reform Bill