Woodfi nes Solicitors
Identity verifi cation – it’s time to take action
Yazmin Elliot Solicitor Woodfi nes Solicitors
T e Economic Crime and Corporate Transparency Act 2023 is considered to be the largest overhaul of company law in recent years. T e aim of the Act is to combat fraud and money laundering by strengthening company oversight, improving transparency, and empowering Companies House to verify and challenge suspicious information. T is largest change being introduced is the mandatory
identity verification for any individual involved in company governance. The legal obligation to have identifi cation verifi cation applies to all company directors, members of limited liability partnerships (LLPs), people with signifi cant control (PSCs) and anyone who submits documents to Companies House on behalf of a company. From November 18, any newly appointed director,
member of an LLP and/or PSC (whether in existing companies or companies being newly incorporated) must complete their identity verification before their appointment as director or member of LLP or PSC can be legally recognised. T is means that no individual can act as a director or member of an LLP or be appointed a PSC unless their identity has been verifi ed. Once verifi ed, the individual will be issued a personal
code that is to be used when registering or filing with Companies House. T is code will need to be retained as part of your personal and corporate records as it will be needed when the company fi le their confi rmation statements. Companies House will require confi rmation that the
identity verifi cation has taken place on confi rmation state- ments filed from March 2025. Therefore, any company whose confi rmation statement fi ling deadline falls in the year will need to ensure their directors and PSCs are verifi ed before or at the time they fi le their confi rmation statements. If your confi rmation statement date is approaching you
need to act now.
How to get verifi ed Individuals can verify their identity through Companies House directly and will need a
GOV.UK One Login to do so.
GOV.UK One Login will ask questions to determine the method the individual should use to verify their identity. It will depend on what device the individual has and what identifi cation documents they individually hold and is done through a mobile app, online security questions or through a participating Post Offi ce branch. Alternatively, individuals can verify their identity
with an Authorised Corporate Service Provider (ACSP). Solicitors and accountants can register to be an ACSP, which allows them to verify the identity of individuals and carry out fi lings on behalf of companies. All ACSPs will be regulated under UK money laundering regulations and can
ALL THINGS BUSINESS | 44
be ideal for individuals who are based overseas, do not have the required UK or EU identity documents, or incur diffi cul- ties with the digital verifi cation processes outlined above.
Consequences of not being verifi ed Failure by an individual to verify their identity can have seri- ous consequences for both the individual and the company. Companies seeking to appoint unverifi ed individuals
risk having their fi lings rejected by Companies House or the incorporation of a company blocked entirely. Delay in fi lings or missed fi lings can result in fi nes for the directors and offi cers, the company itself may be struck off the register and dissolved and in some circumstances, the directors may be disqualifi ed from holding future company positions. Acting as a director, member of an LLP or as a PSC
without having their identity verifi ed will constitute a criminal off ence. It is anticipated that Companies House will annotate
public registers to show individuals as being ‘unverifi ed’. T is is a clear signal of poor governance and will act as a major red fl ag to lenders, customers, suppliers, investors and regulators. It is expected that there will be a huge infl ux of verifi -
cations in the coming months. It is therefore advised that all directors, members of LLPs, PSCs or persons who make fi lings on behalf of companies take action to reduce the chance of delay, disruption and potential penalties.
Woodfi nes LLP is a registered ACSP and can assist both individuals and companies with verifying identity.
To fi nd out more about the new identity verifi cation requirements, contact CorporateCommercial@woodfi
nes.co.uk or visit www.woodfi
nes.co.uk
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