The identity verification awareness gap

Identity verification under The Economic Crime and Corporate Transparency Act 2023 (ECCTA) is now mandatory and businesses are not prepared. Last year Law Debenture research flagged that while 89% of the 500 UK directors surveyed felt they ‘fully’ or ‘mostly’ understood ECCTA legislation. However, when asked for detail there were significant knowledge gaps.  

Consider these findings: one in three directors incorrectly believed that ECCTA includes stronger accounting standards. A quarter thought monthly compliance checks would be required. Perhaps most concerning, up to 40% were unclear on the penalties for non-compliance, penalties that could include unlimited fines, potential imprisonment, and director disqualification. 

We are now seeing the real life impact of these gaps. When it comes to identity verification, businesses with filing deadlines in the months since November could already be facing penalties for non-compliance. With a huge concentration of filing deadlines in December, many have already learned the hard way and with the next peak being March others are running out of time.  

The verification challenge 

Coming up to three months since identity verification became mandatory (November 18, 2025), confusion remains about who must verify, when they must do so, and how to navigate the process. 

New directors and PSCs must verify on appointment or incorporation. Existing directors must complete verification within 14 days of their next confirmation statement. Existing PSCs who aren't directors of the same company face different timelines depending on their specific circumstances. 

The verification process itself presents obstacles. While Companies House offers verification through GOV.UK One Login, this requires a biometric passport and works via app-based verification. For directors with international documents, complex name variations, or those who've experienced technical issues with the system, the process can be frustrating. 

Ben Turner, Managing Director of Corporate Secretarial Services at Law Debenture reports frequent rejections from the Companies House system. Common reasons include document types not accepted, international documents not recognised, and technical glitches with app-based verification.

Ben shares “We are now handling requests on a daily basis for those who have not been able to verify themselves and require us to get them verified quickly, some in as little as 24 hours. These are people who knew the requirement existed but underestimated the complexity. In addition, we have had a number of urgent requests from people who did not know about the requirements and have missed their deadline. Luckily, we can help.” 

The cost of non-compliance 

What happens to businesses that fail to meet identity verification requirements? The consequences are severe and multifaceted. 

Criminal penalties include unlimited fines and potential imprisonment. Directors can face disqualification. But the operational impact may prove equally damaging: non-compliant companies cannot incorporate new entities, appoint new directors, or file documents with Companies House. Perhaps most embarrassing, Companies House will publicly mark their non-compliance on the register for all to see. 

These aren't abstract threats. They represent real business disruption for organisations that fail to prioritise compliance. 

Bridging the gap 

The awareness gap isn't insurmountable, but closing it requires immediate action. Jordan Owen, Head of Global Entity Management at Law Debenture, emphasises the urgency: "Time is running out to comply with the new ECCTA regulations, and our research makes it clear that significant knowledge gaps are hampering preparedness. The number of directors who are unclear on ECCTA policies, as well as the potential repercussions, will spark concern as the deadline looms." 

For businesses struggling with verification requirements, Law Debenture’s professional support offers a practical solution. Authorised Corporate Service Providers (ACSPs) can handle electronic and in-person verification, provide professional support for rejected applications, and manage bulk verifications for organisations with multiple directors. 

As Jordan Owen advises: "Don't bury your head in the sand. Be proactive. The earlier you prepare, the smoother the transition." 

The bottom line 

Ben Turner, adds: "The new ECCTA legislation makes it crystal clear that good governance should be an absolute priority." 

The IDV awareness gap isn't just about directors not knowing what they don't know. It's about the dangerous confidence that comes from believing you're prepared when significant knowledge gaps remain. As deadlines approach, bridging this gap must become an urgent priority for UK entities. 

For those still uncertain about their obligations, the message is clear: seek professional advice now, start the verification process immediately, and treat ECCTA compliance as the business-critical issue it truly is. The cost of complacency far exceeds the investment in getting it right.

Want to find out more, contact us at IDV@lawdeb.com