The Prime Minister has outlined proposals for a mandatory national digital ID. I share your sincere concerns about this policy, which is a cynical gimmick to distract from the Government’s recent scandals and disastrous efforts to counter illegal immigration. My colleagues and I firmly oppose this scheme. You can read my statement on this policy here:
Mims Davies MP Statement on Digital ID | Mims Davies
However, I do think it is a mistake to conflate Kier Starmer’s proposals for a mandatory national digital ID with the verification of company directors by Companies House. I understand the aim of the identity verification requirements in this context is to prevent individuals from creating a fictitious identity or from fraudulently using another person’s identity to set up and run a company. Identity verification of company directors plays a key role in giving confidence to investors and consumers alike, ensuring greater transparency about the organisations with which they do business.
While the UK has one of the world’s largest and most open, liberal and business-friendly economies, and is an extremely attractive place to do business, that same environment also exposes us to serious economic crime, such as money laundering, corruption, the financing of organised crime and terrorism, and a growing range of state threats. I want to be clear that economic crime has devasting consequences for the individuals involved and must be tackled head-on. Of course, tackling fraud must be balanced with the need to avoid undue disruption and therefore the identify verification process must be straightforward and proportionate.
As constituents are, no doubt, aware the Companies Act 2006 required individuals who set up, ran or controlled a company to verify their identity. Individuals could verify their identity through the registrar directly or via an authorised corporate service provider, such as an accountant or solicitor. However, the legal framework required Companies House to accept information from entities and individuals in good faith, with no checks to confirm that someone registered as a director or person with significant control had given their consent or was a real person.
The previous Government therefore legislated in the Economic Crime and Corporate Transparency Act 2023 to strengthen that identify verification for new and existing directors, beneficial owners, and those who file information with Companies House, as well as giving Companies House new powers to check, challenge, and decline any questionable information on the Register. These Economic Crime and Corporate Transparency Act’s reforms to Companies House were very necessary as the previous Government could not allow a situation to continue where the Royal United Services Institute deemed it a danger to our national security.
Those provisions, which the current Government has implemented, will help Companies House do more to tackle criminals, terrorists, and corruption, strengthening Britain's reputation as a place where legitimate business can thrive, whilst driving dirty money out of the country.
