UK corporate register shows 181 central banks, only 3 of which are real

The UK corporate register, Companies House, lists 181 companies that classify themselves as carrying out central banking activities — one of which is Jacksonville, Florida-based The Seven Dwarfs Ltd. Only three entities correspond to the Bank of England, the only UK central bank.

The Economic Crime and Corporate Transparency Act (ECCT) 2023 came into force on March 4, 2024, and empowered Companies House to prevent its abuse for scams and money laundering. Ultimately, companies seeking to register in the UK will be required to submit enhanced due diligence checks. From February 2025, Companies House will be able to “expedite the striking off” of companies deemed to have been “formed for a false basis”.  

“Where incorrect, suspicious, or fraudulent filings are made, we will take appropriate action,” said a Companies House spokesperson. “We are developing systems and processes to enable more checks to determine the accuracy of information delivered to us before it is placed on the register.”

A Bank of England spokesperson declined to comment.

Slow change

Meanwhile, criminals continue to exploit the register, with around 20% of the 5 million companies registered in the UK believed to be fraudulent.

“Criminal opportunities are plentiful where, to the lay person, the Companies House listing is a powerful convincer of bona fides,” said Ray Blake, a financial crime subject matter expert at Risk Alert 24/7 and co-presenter of The Dark Money Files podcast.

“While Companies House is becoming the sturdy gatekeeper we all want it to be, there remain opportunities that criminals will exploit ruthlessly while there is still time. When it comes to fraud and money laundering, the doors are closing, but theyʼre closing slowly. And while that continues, the bad guys are piling in like itʼs after dark on Christmas Eve,” he warns.

Starting on February 25, individuals and organisations will be able to register as an Authorised Corporate Service Provider (ACSP) and provide identity verification services to companies seeking to register on Companies House. And as of March 25, individuals will be able to verify voluntarily their identity using a GOV.UK one login.

Fake banks

Enhanced due diligence checks, including identity checks, should come in later this year. In the meantime, fraudsters are setting up fake banks and central banks on Companies House, as shown in a recent report by Tax Policy Associates, which analysed 16 fake banks with fake assets.

“These aren’t just accounting anomalies. Fake banks can be used to launder illicit funds, deceive investors, and give credibility to fraudulent schemes. We have evidence that some of the firms we’ve identified have done just that; the likelihood is that others are doing it as well — they just haven’t been caught yet,” Tax Policy Associates said.

Tax Policy Associates has also identified an example of fraudsters obtaining Financial Conduct Authority (FCA) registration in 2019 for a company called AR Worldwide Services Ltd. That firm was linked to Stallion Holdings Ltd, which the FCA rejected when it applied to be registered in 2017.

“AR Worldwide Ltd did not update Companies House of the changes to their directors for three years after they were appointed. Registered and authorised firms must tell us about significant changes to management, including directors. If a firm informed us of any changes, we would have reviewed the individuals involved and considered whether there was any adverse information available to us. If we find a firm has misled or failed to notify us, we can take action,” said an FCA spokesperson.

Bank names need FCA OK

Proposed company names which include a sensitive word or expression, such as ‘bank’, are automatically stopped, pending further consideration of whether the company names rules have been met. Use of the word ‘bank’ in a company name requires a letter of non-objection from the FCA.

Companies House has the power to direct a company to change its name if misleading information was provided for the purpose of the approval of a sensitive word, if the name is misleading about the company’s activities and likely to harm the public or if the name has been used, or is intended to be used, by the company to facilitate fraudulent activity, its spokesperson added.

Removing addresses

As of late January, Companies House had removed 60,700 suspicious or inappropriate registered office addresses, 47,200 officer addresses and 42,900 people with significant control (PSC) addresses. It also redacted 40,300 incorporation documents to remove personal data used without consent.

In another move, it removed 9,500 documents from the register, including false mortgage satisfaction filings, which would have previously required a court order, according to a LinkedIn post from Michael Elkins, a powers and sanctions case manager at Companies House in Cardiff.

*This article was updated on February 12 to include comments from the Companies House spokesperson.