Long standing tax abuse exposing journalist Tom Bergin had a report on Reuters yesterday on the UK's new company beneficial ownership disclosure regime in which he said:
Some UK shell companies under offshore control may be skirting new rules which were designed to clamp down on corruption and tax evasion by forcing businesses to reveal their true owners, a Reuters analysis of corporate filings shows.
British government officials have heralded the rules, which came into effect last month, as a world-leading transparency move to tackle crime and urged other nations to follow suit.
I won't repeat all his allegations, but will note that his concerns echo my own, which have been long stated. This new disclosure regime is, as Tom notes, effectively an honesty box arrangement for three reasons.
The first is that you can say the disclosure arrangements do not apply to you and supply no data and no one checks whether that is true, ever.
Second, if you supply data that is incorrect information no one one would ever know because no one checks.
And third, as Tom notes:
[A]spokeswoman for Companies House, said:
"It is perfectly legitimate for a company to have no beneficial owners and we do not verify such statements when they are submitted to us."
If a complaint was referred to Companies House, it could refer the complaint on to the BEIS, she said.
So, what we have is a regulatory agency that takes any statement made to it at face value and passes on all complaints to someone else. By any objective standard that is about as close to useless as a regulatory regime can be.
It's my suggestion that this is not chance but is in fact deliberate. The UK wants to look as if it is doing something on beneficial ownership but is, in fact, really and deliberately doing nothing at all. Call it constructive non-compliance: all the appearance of doing something whilst actually undermining the very purpose of the regulation in question.