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How will Cable’s new anti-corruption rules pan out?

This week the Business Secretary announced plans to crack down on tax evasion, money laundering and the financing of terrorism, via new a publicly available beneficial ownership register.

The proposed register would hold information on individuals with an interest in more than 25% of shares or voting rights in a company, or who otherwise control the way a company is run. Companies will need to supply these details to Companies House when starting up and update them at least once every 12 months. The details required will include details such as the name, date of birth and nationality.

The measures are intended to break clandestine money laundering operations, but how effective will it be? It seems sensible to push for more transparent reporting, although it seems unlikely this alone would deter the ingenuitive and elaborate trails designed to mask company owners.

Those breaking the law will continue to do so until tougher forensic policing is in place to seek them out. I would suggest the new ‘25%’ rule will encourage a fraudsters to diversify and take smaller stakes so as to swerve the requirements.

Labour’s shadow business secretary Chuka Umunna has already said of the plans that proper policing and delivery will be needed - suggested Companies House has a “patchy record” on enforcing existing transparency rules.

This was posted in Bdaily's Members' News section by Tom Keighley .