Significant Number of Companies Failed in Complying With PSC Requirements
Despite the efforts made by the UK government to ensure that companies disclose their ownership through mentioning details of people with significant control (PSC) within the entity by means of a PSC register, there are a significant number of British companies that are still not complying with the rules and regulations brought in to counter money laundering and fraudulent activities.
As per the Freedom of Information request by Fortytwo Data to Companies House, the number of UK businesses that are yet to show compliance with the new regulations are around 57,227 meaning that these businesses must declare the PSCs in their submissions to the Companies House.
Although, the number of companies that have not yet shown compliance with the new regulations only represents 1.6% of the total 3.5m companies that are registered at Companies House, but still this statistic raises questions regarding offshore interests and shell ownership.
As per the new anti-money laundering regulations, the non-compliance with the PSC requirements is a criminal offence and the companies found guilty of such act could face potential sanctions including fines and the culpable individuals could also be required to serve up to two years in prison.
The rules and regulations relating to PSCs were tightened in June 2017 following the introduction of the regulations in April 2016. As for now every company registered at the UK Companies House is legally required to maintain a register containing details of PSCs and the entity must record the said information with Companies House within time period of 14 days.
According to the National Crime Agency, it is believed that sum of around £90bn in criminal proceeds is laundered in the UK annually.
The requirement to disclose PSCs by means of a PSC register is an attempt made by the authorities to make sure that money launderers are not provided with any opportunity to store and channel the laundered money using apparently registered corporate entities.
While the majority of the registered companies are displaying compliance with the new anti-money laundering regulations but there still are those 57,227 companies that are not doing the same and this undermines the attempts made by the government to prevent money laundering through implementing latest anti-money laundering rules.