UK sets timeline for stricter corporate IDV, AML controls

Businesses in the UK have until the end of 2026 to comply with new identity verification requirements for directors and those with corporate control, according to a transition plan set out in a policy paper from Companies House. The changes are being introduced to crack down on money laundering and corporate fraud.

The Economic Crime and Corporate Transparency Act 2023 (ECCT Act) is intended to ensure all stakeholders required to submit a document to the registrar do so, that the register’s information is accurate and complete, that the register’s records do not mislead the public and to prevent companies from breaking the law.

It will be introduced in phases, but the identity verification requirements for new business directors and people with significant control of a company (PSCs) will take effect in autumn of 2025. They will be required to verify their identity when their company is incorporated, with a 12 month transition period for existing companies. At that point, identity verification becomes part of the annual confirmation statement filing.

Companies House estimates that 7 million people will have their identities verified under the Act, which bestowed new powers on the agency effective last year. The rollout of changes followed on the heels of revelations that hundreds of fake businesses, some of them fairly obviously fraudulent, had been allowed to register with Companies House.

Trust and Company Service Providers (TCSPs) and other professionals, like accountants and lawyers registered for AML with a UK supervisor can register to become Authorised Corporate Service Providers (ACSPs) as of February 25. They can then offer identity verification services to their clients, and inform the registrar of passed IDV checks.

Voluntary identity verifications with Companies House are expected to open on March 25, and by spring of 2026, any document filed will have to be accompanied by an identity verification of the presenter. The Act will continue to take effect in several further steps through the end of 2026, at which point compliance enforcement will begin.

The ECCT Act does not specify how identities are to be verified, leaving some uncertainty about whether biometrics are required, but AML compliance generally requires either in-person or biometric ID verification.

The three Registrars of Companies in the UK are located at Companies Houses in Cardiff, Edinburgh and Belfast.

Article Topics

AML  |  Companies House  |  digital identity  |  identity verification  |  KYB  |  UK