New protections for company directors against identity fraud

  • Insight

22 March 2018

The UK Government announced plans to introduce new regulations to protect company directors against identity fraud in February 2018.

The plans came in response to the conclusions of a joint report that claimed fraudsters are using information on the public record at Companies House to steal the identities of company directors. The joint report by Cifas and Lexis Nexis Risk Solutions also raised concerns that the information is leaving directors vulnerable to violence and intimidation.

The joint report worryingly highlighted that one in five of all identity frauds are against company directors, despite them comprising less than 9% of the UK’s population. Furthermore, 17% of victims had suffered identity fraud on multiple occasions.

Why directors?

Directors are often targeted as they are perceived to be more likely to be credit worthy and there is more publicly accessible information available concerning these individuals than the average person. It is thought that fraudsters use this public data as a starting point to then access credit files or gather more detailed information through social media. The report found that the fraudsters mainly use this information to purchase products and services online.

So, what can be done?

One of the recommendations in the report is to limit the information publicly available. At present, directors have to provide their residential addresses, however this is not normally displayed on the public record. This is not the case where a director has registered their residential address as their service address. Residential addresses are shared with specified public authorities and credit reference agencies.

However, if an individual became a director before 1 October 2009, there are likely to be documents filed with Companies House that contain their residential address and which can be found relatively easily in the filing history of the company.

Directors can apply to the Registrar to make their residential address unavailable for public inspection, however there are stringent criteria that need to be met. Addresses will only be removed when Companies House and a court consider there to be serious risk of violence or intimidation to the director. Filings prior to 1 January 2003 cannot be removed in any circumstances. The intention of the new regulations is to make it much easier to suppress this information.

What is changing?

The new regulations will allow directors to apply to have their residential addresses removed from the register without having to demonstrate a serious risk. The regulations will also remove the 1 January 2003 rule.

These changes, which are set to come into force by the end of Summer 2018, will come as a welcome relief to those directors who are concerned about the public display of their home address but are unable to meet the current criteria.

How can we help?

If you are unsure whether or not your residential address exists on the public records then we would be happy to assist.

We can run an extensive search on the filings of the company and identify any instances where your residential address is visible. We can then assist you with applying to Companies House to remove your address. This will give you the peace of mind to continue managing your company in the knowledge that you are less susceptible to fraudsters.