Hundreds of businesses registered on Companies House have their names shockingly misspelt when they were set up with 77 even having the mistakenly spelt word ‘buisness’ in their title.
While the comical misspellings – including 276 companies using the word ‘accomodation’ and 310 using the word ‘enviroment’ – are laughable lawyers from Devonshires, who carried out research, say it is further sign that companies could be being set up for fraudulent purposes.
The ease with which individuals can set up a company was exposed when it was revealed that £4.3 billion of fraudulent COVID business loans were written off earlier this year.
Many of the fraudulent loans were made to shell companies registered in the UKLord Agnew, a Treasury and Cabinet Office minister resigned and called the oversight of the scheme “nothing less than woeful” and accused officials of “schoolboy errors” on multiple fronts.
Helen Curtis, corporate partner at Devonshires said:
“In most other countries, incorporating a new company involves visits to a notary with proof of identification, thousands of pounds of capital investment and a specialist who is usually a lawyer. In England and Wales it involves making up a company name, guessing a share structure and paying £12. This makes it easy for fraudsters to set up a company and appear legitimate.
“The huge number of spelling mistakes in names is a clear sign that companies were registered in a matter of minutes with little thought. Companies tend to be dealt a greater degree of gravitas than sole traders, so the ease with which one can be set up is a perfect foil for fraudsters wishing to take advantage of members of the public.”
Other misspelt names
Other words misspelt in company names being set up on Companies House include ‘independant’ – rather than independent – 310 times, ‘liason’ – missing the second ‘i’ – 30 times, ‘aquire’ – rather that acquire – 29 times, ‘calender’ – rather than calendar – 14 times and ‘acheive – ‘rather than achieve – five times.
A government white paper last month recognised that it is time to add some extra layers to confirm identity and Helen says this cannot come quickly enough.
She said: “Currently, Companies House is required by law to accept information if it is ‘properly delivered’ and it has very limited powers to correct or query information. The white paper recognises that this needs to change and it needs to happen soon to avoid further fraud.
“As well as checking names, one of the key elements needed is for Companies House to enhance the identity verification system. At present there is no proof required that you are John Smith other than that you say you are. There is acknowledgment that some additional layer of security is needed to establish this. No method is fraud-proof, but technology now exists where a person can take a photograph of their face and the identifying document. Likeness matching technology can now compare these and the photo identification can be validated.
As a starting point, this is a clear pathway to reducing fraud. “To ensure that the integrity of Companies House is maintained it is crucial that the role of Companies House moves from a passive to an active one while individuals need to be aware that the mere existence of a company is not evidence of a genuine business, though with the latter I would hope that people would think twice if the name of the company is spelt wrong.”
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