Britain to overhaul public company registry in dirty money crackdown

By Kirstin Ridley and Sinead Cruise

LONDON (Reuters) -Britain on Thursday laid out fresh plans to crack down on “dirty money” and organised crime by beefing up the powers of its public registry of companies to make it an active gatekeeper against dubious information.

Under the Economic Crime and Corporate Transparency Bill that will be considered by lawmakers, anyone registering a company in Britain will have to verify their identity. The move is aimed at stopping the use of UK-registered firms as a front for international money laundering networks and fraudsters.

The long-awaited move comes around six months after Britain introduced a previous Economic Crime Bill to try to “hobble” Russian President Vladimir Putin, as lawmakers across the political spectrum call for greater efforts to stem the flow of Russian cash into London amid an escalating war in Ukraine.

“I am delighted that today we are introducing reforms that will make it much harder for kleptocrats to shield their ill-gotten gains and treat the UK as their safe deposit box,” said Security Minister Tom Tugendhat.

Transparency International UK, an anti-corruption group, has found 929 British companies involved in 89 cases of corruption and money laundering, amounting to 137 billion pounds ($154.14 billion) in economic damage.

It welcomed the government’s proposals. But its director of policy, Duncan Hames, said that without sufficient resourcing or a concerted crackdown on rogue company service providers, the reforms would still not be able to adequately address Britain’s role as a safe haven for illicit funds.

A government source has told Reuters that the Companies House register would be “sufficiently resourced” to meet its new requirements, which include investigation and enforcement powers to allow it to cross-check data with public and private partners and flag suspicious activity to authorities.

Companies House is Britain’s public registry of companies, their directors, significant shareholders who control the business and their financial filings.

Anti-corruption groups have long called for reforms to the registry to improve transparency and tackle corruption through shell firms. At the moment, companies can be owned by nominees and many do not file full financial statements.

Britain has also separately introduced a registry for overseas entities, although it gives anonymous foreign owners of property six months to reveal their real identities – a measure the opposition Labour Party has said gives them too much time to move assets elsewhere.

($1 = 0.8888 pounds)

(Writing by Kirstin Ridley, editing by Deepa Babington)