Filing false information at Companies House: a £12,000 penalty
In what is understood to be the UK’s first ever successful prosecution for providing false information to Companies House, a man has been ordered to pay over £12,000.
One of the obligations imposed on companies in return for their limited liability status is that certain information about their position and operations must be made public by filing it at Companies House. This includes the company’s annual accounts and constitutional documents (such as its articles of association) as well as information about its registered office address, shareholders, directors and charges. A company must also tell Companies House when particular events occur such as new shares being issued, a special resolution being passed or a change in its accounting reference date.
Responsibility for filing the relevant information is placed on both the company and its officers (its directors and any secretary). If the relevant information is not filed on time, the company and each officer in default will be guilty of an offence and liable to a fine.
Filing false information
In October 2009 a new offence was created relating to delivering information to Companies House which is materially misleading, false or deceptive. If found guilty of this offence, not only could an individual face a fine, but a prison term of up to two years could also be imposed. This offence could be committed by anyone who delivers information to Companies House, regardless of whether or not they are a director.
In 2013 documents were filed at Companies House incorporating a company called John Vincent Cable Services Ltd. The documents showed that the former Business Secretary, Vince Cable MP, was a director and shareholder of the company. In fact the company was formed by a man called Kevin Brewer without Mr Cable’s knowledge or consent. Companies House took action which resulted in the company being dissolved and taken off the register.
Undeterred by this, in 2016 Brewer filed documents incorporating another company, Cleverly Clogs Ltd, this time 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. Again, Companies House took action to dissolve and strike off the company.
Brewer was then charged with filing false information on the UK’s company register to which he pleaded guilty. He was ordered to pay over £12,000 in fines, costs and a victim surcharge.
A tougher stance
The case confirms a commitment by Companies House to safeguard the integrity of the public register whilst also protecting individuals and companies from fraud. Other measures already put in place help prevent an individual being appointed as a director without their consent or an address being used as a company’s registered office address without the consent of the property owner.
Whilst Mr Brewer’s motives for incorporating the companies are not known, his case shows that the penalties for breaching the rules can be severe and what may initially seem like a relatively innocent piece of mischief making can have significant consequences.
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