Millions of directors are not fully prepared for identity verification rules, with just 50 working days to go

This article was originally published on Business-Money.com - read the original here. 

Our summary:

• Widespread unpreparedness for ECCTA deadline: With only 50 working days remaining until the new identity verification requirements take effect, just 58% of UK directors feel fully prepared, while 33% are somewhat prepared and 9% are completely unprepared for the mandatory compliance rules.
• Small businesses face greatest risk: Smaller companies are disproportionately unprepared, with 28% of businesses with 9 or fewer employees completely unprepared for the requirements, compared to larger firms that typically have more robust governance policies already in place.
• Severe consequences for non-compliance: Directors who fail to meet the ECCTA identity verification deadlines face significant penalties including unlimited fines and criminal charges, making urgent preparation essential to avoid substantial financial and legal repercussions.

Chelsea Chivers, head of UK Entity Management, Law Debenture, commented: “ID verification is a simple, yet crucial, element of compliance under the new ECCTA legislation – yet there is clear evidence that many businesses are facing a race against time to meet the deadline.

“Good governance is not a nice to have – it’s an absolute necessity. The penalties for failing to comply cannot be understated, yet there appears to be a sense of inertia amongst many businesses. Directors of small businesses in particular, who are juggling many responsibilities already, seem to be struggling to untangle a web of compliance which is becoming increasingly difficult and complex to navigate. As businesses are inundated with ever-growing lists of responsibilities, support is on hand via specialist firms who can guide companies and directors through the various facets of new legislation; ensuring governance is in check and time is freed up to allow directors to focus on the day-to-day aspects of their roles.”

Law Debenture provides identity verification services to guarantee compliance with Companies House requirements. Learn about the verification service here.