corporate identity theft
minimising the risk
Corporate identity theft is on the increase. It affects all
business sectors and is estimated to cost UK industry more than £50
million per year. Fraudsters can change the names of the registered
office and directors of a company - effectively stealing the
company’s identity - simply by lodging forged forms at Companies
House.
This could affect a business in the following ways:
- your company’s assets could be stolen and bank accounts emptied
by criminals who have fraudulently appointed themselves as
directors of your company
- your company’s identity could be stolen by fraudsters who will
then trade on your company’s creditworthiness, ordering goods and
services on credit, for which you could be sued for payment
- your company could sell goods or services to fraudsters who
have stolen a legitimate company’s identity and you may never
receive payment for the goods or services you have supplied
In all cases, you are not likely to find out what has happened
until it is too late.
Companies House receives documents in good faith and does not
have the power or resources to check that the signatures are
genuine. For this reason, Companies House has introduced an
anti-hijacking scheme called ‘PROOF’ (PROtected On-line Filing). If
you sign up to this service, Companies House will give you a PIN
and password and will only accept documents capable of changing the
registered office or directors’ details electronically. Any such
forms filed on paper will be returned to the registered office.
69,731 companies have signed up to PROOF since its launch in
January 2005.
The following simple steps will minimise the risk of your
company becoming a victim of corporate identity theft:
- file documents at Companies House electronically and sign up
for PROOF
- alternatively, subscribe to the Companies House Monitor
service, which promptly alerts you when a document is filed on a
company’s record
- do not rely on Companies House records alone when deciding
whether to lend goods or services on credit. Always satisfy
yourself that your customer is legitimate through additional
means
