Ambition and enforcement: toward ECCTA transition

October 2026  |  FEATURE | FRAUD & CORRUPTION

Financier Worldwide Magazine

October 2026 Issue

Designed to tackle economic crime by increasing the transparency of corporate entities, the UK’s Economic Crime and Corporate Transparency Act (ECCTA) introduced the most significant reforms to UK company law in almost two centuries.

The Act, which received royal assent on 26 October 2023, overhauls the Companies House register by introducing mandatory identity verification for directors and people with significant control (PSCs), while also creating a new corporate offence of failing to prevent fraud.

From lending and procurement to investment and due diligence, the register plays a key role in informing a vast range of business decisions. Improving its accuracy and reliability is intended to support better decision making, strengthen confidence and promote growth across the UK economy.

The reformed register introduces several significant changes for businesses.

Identity verification requires all company directors and PSCs to confirm their identity through a government website, helping ensure that those running companies are who they claim to be.

Companies are no longer required to maintain separate statutory registers of directors, directors’ residential addresses, secretaries and PSCs. However, companies must continue to maintain a register of members.

Filing requirements have also changed. Small and micro-entities must submit a profit and loss account to Companies House, although this information can remain unavailable for public inspection.

Companies House has also gained broader powers to reject company names that are offensive, facilitate criminal activity, or are misleadingly similar to existing registered names.

“The era of firms treating Companies House as a passive filing service is firmly over, and enforcement is rapidly catching up with the ECCTA’s ambition,” says Meg Ogunsola, global head of entity management at Vistra. “Companies House deserves credit for the progress it has made in cleaning up the register. The scale of activity is significant, with nearly twice as many registered office addresses removed from the register as last year, and millions of people verifying their identity.”

Passive receiver to active gatekeeper

Reflecting its transformation from a passive recipient of information into an active gatekeeper capable of rejecting or removing inaccurate data, Companies House recently published its latest report on the implementation of parts 1 to 3 of the ECCTA.

The agency’s third report, covering the period from 1 April 2025 to 31 March 2026, highlights progress in improving the integrity of the Companies House register and presents evidence of tangible results.

According to the report, nearly 4 million individuals have verified their identities and linked their appointments since identity verification became mandatory. Since March 2024, around 151,000 company addresses have been removed from the register, while collaboration with law enforcement agencies, including HMRC and the Insolvency Service, has led to the seizure of millions of pounds in suspected criminal proceeds.

“The report is a clear sign that Companies House reforms are beginning to bite,” affirms Ms Ogunsola. “More than half of eligible individuals have now verified their identity.

“Also, more than 150,000 company addresses have been removed from the register and millions in suspected criminal proceeds have been seized,” she continues. “That demonstrates real progress in cleaning up inaccurate data, strengthening confidence in the register and making it more difficult for criminals to exploit corporate structures.”

Despite this progress, significant work remains. With the transition window nearing its conclusion, approximately 3 million directors and PSCs have yet to complete identity verification.

“Those that fail to verify before the end of the transition period could face serious consequences, including unlimited fines, restrictions on acting for companies and potential disqualification,” adds Ms Ogunsola. “This could cause lasting operational and reputational damage for both the individuals affected and the firms they represent.”

One way or another

The next phase of the Companies House reforms will include further expansion of identity verification requirements, enhanced transparency measures for the Register of Overseas Entities and a more systematic, intelligence-led approach to enforcement.

Additional reforms are intended to ensure that regulatory action remains targeted, proportionate and effective, supporting legitimate businesses while tackling those seeking to abuse the system. In doing so, the reforms aim to strengthen confidence in UK corporate structures and reinforce the economic benefits of limited liability.

“The reforms are backed by increasingly robust enforcement, giving regulators every chance of achieving their objectives,” notes Ms Ogunsola. “Firms must act now to verify identities, review filing records and address compliance gaps as once the deadline passes, a lack of preparation will not be an acceptable defence. One way or another, businesses will meet the new standards, either by preparing now or by paying the price later.”

With less than two months remaining until the expected conclusion of the identity verification transition period in mid-November 2026, time is running out for directors and PSCs to complete verification, reduce compliance risk and contribute to a more accurate and effective Companies House register capable of playing a stronger role in tackling economic crime.

© Financier Worldwide

BY

Fraser Tennant