August 14, 2016
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.
Twelve filed their annual ownership statement before the new rules came into effect on July 1, although their anniversaries fell after that date. They could thus apply the old rules which did not require them to declare beneficial owners. Others filed late or stated they did not have any beneficial owners. Robert Palmer, policy advisor at advocacy group Global Witness, said the filings showed people might be able to hide behind shell companies despite the new system. “One of the biggest flaws with the UK set up is that it is based on self-reporting and Companies House (which runs the UK Corporate register) has limited resources to go after people who fail to provide information or provide incorrect information,” he said.