The FT has drawn attention this morning to the story of Kevin Brewer. He is the company formation agent who, because he was so fed up with Companies House creating systems that permitted absolute gibberish to be filed as company data as if it were true, made his point by creating two companies using false data. As a Companies House press release noted, the false data was personal information of ministers who had been or were responsible for Companies House. As they put it:
UK's ‘first ever' successful prosecution for false company information
A company director has been fined for deliberately falsifying information about his firms in what is thought to be the first-ever conviction of its kind.
Kevin Brewer, a businessman, incorporated John Vincent Cable Services Ltd in 2013, making the former Business Secretary Vince Cable MP a director and shareholder without his knowledge. The company was dissolved and taken off the company register after Companies House took action.
Brewer, 65, then formed another company in 2016, Cleverly Clogs Ltd, making Baroness Neville-Rolfe — the Minister with responsibility for Companies House — James Cleverly MP and an imaginary Israeli national, Ibrahim Aman, all directors and shareholders without their knowledge. Companies House dissolved the company and took it off the company register.
Brewer, from Ullenhall in Warwickshire, was ordered to pay over £12,000 after he pleaded guilty to filing false information on the UK's company register at a hearing in Redditch Magistrates' Court last Thursday 15 March.
This is thought to be the first time a company director has been successfully prosecuted for falsifying company information under laws which came into force in 2009.
A Companies House spokesperson said:
"Deliberately filing false information on the register is a serious offence and people who have been found to have knowingly done this can face prosecution."
Business Minister Andrew Griffiths said:
"This prosecution — the first of its kind in the UK — shows the Government will come down hard on people who knowingly break the law and file false information on the company register.
"Companies House works hard to protect and continually upgrade the company register, identifying potentially criminal activities and working closely with law enforcement bodies to help bring those perpetrators to justice."
The company register is operated by Companies House and contains information about company addresses, accounts, and those who own and run companies. There are nearly 4 million companies on the UK's company register and the vast majority of these companies use the register lawfully.
Companies House should be hanging its head in shame at this press release. And this prosecution. Brewer should be getting a medal for public service, and compensation for being persecuted as a whistleblower. Because the simple fact is that, as I have said many times over many years, Companies House is not just a joke: it is a farce.
Not only does it deliberately and persistently falsify data by claiming almost 100% compliance rates by companies by simply removing all those that are non-compliant from the register as soon as default occurs and saying that they are 'in the course of being removed', so completely distorting the public perception of its effectiveness, it also fails to investigate the vast majority of non-compliance. It simply closes companies down rather than take any action to pursue data that should be on public record. And at the same time it does almost nothing at all to make sure that data on record is correct.
So, there are no checks on accounts. They need only balance and they are deemed fit for publication whether or not they comply with the law.
We know they refuse to do standard money laundering checks that are required in the private sector, creating a massive loophole in company law that is exploited by criminals from around the world.
And we know that the only thing they check when getting most documents is that the postcode recorded on them is valid. Not correct, I stress, but valid.
Companies House is a national disgrace. It costs us billions a year in lost tax revenue and probably more in other crimes.
And now it prosecutes those who seek to point out its failings. How much worse can it get?
Thanks for reading this post.
You can share this post on social media of your choice by clicking these icons:
You can subscribe to this blog's daily email here.
And if you would like to support this blog you can, here:
Buy me a coffee!
I do wonder who benefits from this farce? Is there an international index on opacity? The UK would get very good scores.
The severely incompetent can be vengeful when exposed.
There is nothing quite so effective as standing on one’s dignity to demonstrate lack of stature.
Perhaps if he hadn’t filed on April Fools day nobody would have noticed ?
It is perfectly possible that CH would never have noticed. How did they spot the problem? Mr Brewer informed them and, just to make sure that they did take notice, he told the press! (https://twitter.com/OliverBullough/status/985574754420654080)
And still they prosecuted him
If there is an upside to this, at least there is now a successful prosecution on record for deliberately filing false information.
For anyone considering submitting a false document to Companies House, there is now a clear precedent. Not onlyh will there be a fine (to which you might say “so what?”), but the prosecution will be a matter of public record. Think of the reputational damage done if someone is on record for deliberately falsifying documents?
The real crime would be not to follow this prosecution up with a string of ‘legit’ ones.
Good point
Geearkay says:
“The real crime would be not to follow this prosecution up with a string of ‘legit’ ones.”
‘Would’ ?
My money is on ‘Will’.
Last year I discovered that a director of a company I had a minority shareholding in had made a return to Companies House stating that I had transferred my shares to him. I thought that this was a clear case of fraud; no share transfer form had been completed by me and if the director had one it contained a forged signature.
I lodged a complaint of a fraudulent share transfer to Companies House and was amazed to be told that they would take no action and it was up to me to pursue this on my own.
Where are Companies House priorities?
Companies House say they are simply a registrar and not a regulator
They just run a depository of documents not caring if they are right or wrong
In effect we do not have company regualtion in the UK because there is literally no one who does it
It’s a bit like the registrars of births in a way. They don’t try to do the job of social workers, or promote breast-feeding. They don’t query if a decent human being has been brought into the world to decent parents, or if the parents can afford to feed and clothe the extra mouth.
Yes
But I am also aware you are a troll
Aneliata Groyne’s analogy of the Register of Births is interesting. Does it mean that a prudent child-smuggler should register a number of fictitious births in advance? Then when they smuggle the children they will have valid documentation to hand? Presumably this must be the case, if the Register of Births is run on the same principle as Companies House?
Michael Green says:
“Aneliata Groyne’s analogy of the Register of Births is interesting. Does it mean that a prudent child-smuggler should register a number of fictitious births in advance? Then when they smuggle the children they will have valid documentation to hand? Presumably this must be the case, if the Register of Births is run on the same principle as Companies House?”
I think you’ll find that is precisely how it’s done in some cases. Perinatal deaths offer a rich source of bogus identities too. Dead babies don’t report identity theft.
But who will act to initiate a series of ‘legit’ prosecutions? If Companies House has no resources to do any checking then by definition there will be no ‘legit’ ones and so the farce will continue.
And they are denied resources, deliberately, of course
What a joke… how did this even get through court ?
He pleaded guilty
Should have gone for trial and a jury would have dismissed it
yes..mistake
“Should have gone for trial and a jury would have dismissed it”
You don’t get much legal representation for twelve grand.
Chimp in a wig if you’re lucky. (Stockings would be extra)
Breathtaking!
I shall write to Mr Griffiths and tell him where he should be looking.
I can’t quite believe they prosecuted him for this obvious exposure. It is, I agree, a bloody disgrace.
Where’s that bugger, Rumpole when you need him. ?
A.P Herbert wouldn’t have dared make this up.
Shame Jolyon didn’t take this one on
Richard Allen says:
“Shame Jolyon didn’t take this one on”
Is it too late to lodge an appeal ?
Ought to be possible to raise the funds from Comic Relief.
‘Comedians Blast Companies House humour deficit’
‘Satirists complain of unfair subsidies to public sector jokers’
Exclusive quote: Business Minister Andrew Griffiths said:
“This prosecution — the first of its kind in the UK — shows the Government […] knowingly break the law and file false information on the company register.
“Companies House works hard to protect […] criminal activities..”
I can see the headlines now. Triple coverage: front page, business pages and celebrity gossip.
One of the newspaper Barons might personally fund it.
🙂
So many stupid things happening at the moment we are spoilt for choice