The Economic Crime and Corporate Transparency Act 2023 makes a number of important changes to corporate transparency and compliance in the UK.
It is going to be easier to prosecute companies for wrongdoing
Prosecutors will no longer have to prove that “the directing mind and will” of a company was behind wrongdoing. Now, any “senior manager” who has engaged in criminality around fraud, tax evasion, sanctions breaches, money laundering, false accounting and bribery can find their actions result in corporate prosecution.
The Serious Fraud Office has increased powers of investigation
The SFO can collect information before an investigation is even opened. They can also send out a notice compelling someone to provide information, and this is before a formal investigation has been launched. Before the change this could only be done after an investigation had already started.
Companies House can scrutinise filings
No longer just a repository of information, Companies House can query or reject filings, remove information on the register, and share data with government and law enforcement.
Failure to prevent fraud is now a corporate offence
Large companies are legally required to put in place reasonable procedures to prevent certain types of fraud. This is similar to the reasonable procedures required by the Criminal Finances Act and adequate Procedures required by the Bribery Act.
Limited partnerships more tightly regulated
Limited partnerships and Scottish limited partnerships have tighter registration requirements. There are new dissolution and deregistration procedures and greater sanctions for non compliance.
Crypto assets can be seized and crypto must be scrutinised
There are more powers to seize crypto assets linked to criminal activity.
Beneficial owners of overseas entities must be disclosed
The Register of Overseas Entities at Companies House will require overseas nominees holding UK land, including trusts, to be reported. This must include more information and there is an offence for failing to comply with an information notice.
