Committee on Standards in Public Life - latest letter on establishment identity fraud and the Lords' weakening their Code of Conduct.

Correspondence continues.

28 March 2025.

Dear Ms Bainsfair and Mr Chalmers,

Thank you for publishing my consultation response (Submission 29) Accountability_within_Public_Bodies_-_open_consultation_responses.pdf and for your March 2025 report, Recognising and Responding to Early Warning Signs in Public Sector Bodies. I welcome the report’s focus on systemic failures in oversight and accountability, which closely aligns with my concerns about identity fragmentation and its impact on ethical standards in public institutions.

While I recognise the significant progress made through the Economic Crime and Corporate Transparency Act 2023 and the introduction of identity verification at Companies House, I remain concerned that the transition to the new system could erase historical evidence of duplicate identities. This poses a risk to audit trails, the investigation of past misconduct, and the detection of conflicts of interest that may have been enabled by identity loopholes.

Request for a Cross-Agency Working Group

Given the systemic nature of these risks, I respectfully urge the Committee to recommend the establishment of a cross-agency working group to address the ethical and operational implications of fragmented identities in the UK’s public and corporate sectors. Such a group could draw on expertise from Companies House, the Public Sector Fraud Authority, Action Fraud, the National Crime Agency, the National Cyber Security Centre, and other relevant bodies.

The working group could:

• Review how legacy identity data is handled during the transition to the new Companies House system, ensuring that evidence of past identity fragmentation is preserved for audit and enforcement purposes.

• Assess the risks of identity fragmentation for fraud, conflicts of interest, and public trust in governance.

• Develop best practice guidance for public bodies on identifying and mitigating risks arising from synthetic or fragmented identities.

• Make recommendations for further regulatory or legislative action if required.

I would welcome the opportunity to present to this group, sharing first-hand experience of how identity loopholes in Companies House have enabled fraud and the concealment of interests, including the creation of clone companies. I believe this perspective could help inform practical solutions and raise awareness of the real-world impact of these issues.

Strengthening the House of Lords Code of Conduct

I am particularly concerned about the recent revisions to the House of Lords Code of Conduct, which have removed the requirement to declare non-financial interests and weakened the overall transparency framework. In light of the Committee’s remit to uphold the Seven Principles of Public Life and promote best practice, I urge you to make the following recommendations:

• Reinstate Mandatory Non-Financial Interest Declarations:
  The Lords’ Code should be realigned with the Companies Act 2006 by requiring full disclosure of all directorships, paid or unpaid, and all relevant non-financial interests.

• Treat Complaints as Valuable Feedback:
  Adopt the CSPL’s own recommendation to maintain robust registration systems and ensure that concerns and complaints are used as opportunities to improve standards and transparency.

• Audit Historical Identity Fragmentation:
  Public bodies, including Parliament, should investigate cases where individuals hold multiple Companies House identities (such as Baroness Manningham-Buller’s NW1/SW1A records) to ensure there are no undeclared conflicts of interest. This should include systematic cross-referencing of the Lords’ Register of Interests with Companies House data to identify and address any gaps.

• Amend the April 2025 Code:
  Remove Section 3’s exemption for non-financial interests and reinstate Appendix B’s detailed definitions of registrable interests. Introduce clear penalties for peers who fail to reconcile fragmented identities or provide accurate declarations.

These steps are essential to restore public confidence, ensure compliance with statutory obligations, and prevent the recurrence of systemic failures identified in your recent report.

Thank you again for your leadership in promoting ethical standards in public life. I hope these suggestions will be of value as you continue your important work advising the Prime Minister and shaping best practice across the public sector.

Yours sincerely,
Alison Wright

This letter is the latest in the following email chain:

From: public@public-standards.gov.uk
To: alisonwright45@btinternet.com
Sent: Friday, January 10th 2025, 10:19
Subject: Fwd: Fwd: Multiple identities in Companies House compromises audits and KYC (breach S1082 CA2006)

Dear Alison Wright,

Thank you for your further email of 23 December 2024.

We have noted your concerns, but the Committee on Standards in Public Life will not be pursuing your request to investigate "breaches of Section 1082 of the Companies Act 2006 (CA2006) regarding multiple unique identifiers for individuals in Companies House" at this stage. We will keep your email on file.

Separately, in your email of 24 December 2024, you asked for a link to your submission to our review once published. It is not possible for us to send a link to all those who contributed to the review, but submissions will be available on our website when the report is published.

Yours sincerely.

Lesley Bainsfair

Lesley Bainsfair

Head of Secretariat

Committee on Standards in Public Life

Room G/07, 1 Horse Guards Road, London, SW1A 2HQ

Follow us on X (Twitter) @publicstandards or at CSPL and CSPL blog

---------- Forwarded message ---------
From: Alison Wright <alisonwright45@btinternet.com>
Date: Mon, 23 Dec 2024 at 12:41
Subject: Re: Fwd: Multiple identities in Companies House compromises audits and KYC (breach S1082 CA2006)
To: public standards mailbox <public@public-standards.gov.uk>

Dear Ms. Bainsfair,

Thank you for your response regarding my submission on multiple identities in Companies House.

Given the Committee's remit to conduct broad inquiries into standards of conduct, I respectfully request that the Committee undertake an inquiry into the following areas:

1. Breaches of Section 1082 of the Companies Act 2006 (CA2006) regarding multiple unique identifiers for individuals in Companies House.

2. The impact of these multiple identities on audits, particularly in relation to Section 441 (CA2006) concerning the filing of accounts and reports.

3. The compromise of Know Your Customer (KYC) checks, which are essential for preventing money laundering and terrorism financing.

4. Potential breaches of Section 1112 (CA2006) regarding false statements to registrar, as multiple identities may constitute deliberate misrepresentation.

5. Implications for Section 386 (CA2006) on the duty to keep accounting records, as multiple identities can obscure financial trails.

6. Possible violations of the Fraud Act 2006, particularly Section 2 (fraud by false representation) and Section 3 (fraud by failing to disclose information).

This inquiry should assess the institutions, policies, and practices that have allowed these issues to persist, compromising ethical standards in public life. The findings could inform recommendations to the Prime Minister on necessary changes to ensure the highest standards of propriety in public life, particularly in relation to corporate governance and financial oversight.

I believe this falls squarely within the Committee's remit to examine current concerns about standards of conduct and make recommendations for systemic improvements to uphold the Nolan Principles.

The existence and exploitation of multiple identities in Companies House directly contravenes several Nolan Principles, particularly Integrity (by concealing interests and connections), Accountability (by evading proper scrutiny), Openness (by obscuring true identities and affiliations), and Honesty (by presenting false or misleading information to official registers), thus undermining the fundamental ethical standards that should govern public life.

The gravity of this issue is further underscored by the fact that both the current Prime Minister, Keir Starmer, and his predecessor, Rishi Sunak, have three distinct identities registered in Companies House, exemplifying how this problem permeates the highest levels of government and urgently requires addressing to maintain public trust and uphold the ethical standards that our leaders are meant to embody.

Thank you for your consideration of this critical matter.

Yours sincerely,
Alison Wright.

References:

Keir Starmer: https://find-and-update.company-information.service.gov.uk/search/officers?q=Keir%20Starmer

Rishi Sunak: https://find-and-update.company-information.service.gov.uk/search/officers?q=Rishi+Sunak

------ Original Message ------
From: public@public-standards.gov.uk
To: alisonwright45@btinternet.com
Sent: Friday, December 20th 2024, 15:45
Subject: Fwd: Multiple identities in Companies House compromises audits and KYC (breach S1082 CA2006)

Dear Alison Wright,

Thank you for your email of 10 December for the attention of the Chair.

I can confirm that we have received your submission to our current review, thank you for taking the time to contribute. We will be publishing your submission with some redactions due to the allegations contained within it.

We have noted the serious claims you make regarding fraud, and your recommendations to address such problems. You asked the Committee to take a series of steps to investigate, but the Committee's remit is to consider arrangements for upholding ethical standards, not to investigate cases of fraud or breaches of the law. I am sorry not to send a more positive reply.

Yours sincerely

Lesley Bainsfair

Lesley Bainsfair

Head of Secretariat

Committee on Standards in Public Life

Room G/07, 1 Horse Guards Road, London, SW1A 2HQ

Follow us on X (Twitter) @publicstandards or at CSPL and CSPL blog

Honesty | Objectivity | Openness | Selflessness | Integrity | Accountability | Leadership

From: Alison Wright <alisonwright45@btinternet.com>
Date: Tue, 10 Dec 2024 at 15:52
Subject: Multiple identities in Companies House compromises audits and KYC (breach S1082 CA2006)
To: <public@public-standards.gov.uk>

For the attention of Mr Chalmers.

Dear Mr Chalmers.

I am writing to follow up on our conversation at the Institute for Government event on 21 November 2021, regarding the critical issue of multiple identities in Companies House being used by public officials to conceal interests and potentially enable fraud.

The Issue

I have observed a worrying trend of civil servants and politicians registering multiple identities in Companies House. This practice allows them to conceal interests and fail to declare them, which is a breach of Section 1082 of the Companies Act 2006. Here is the specific concern I raised during the event:

"I’ve observed a worrying trend of civil servants and many politicians having registered multiple identities in Companies House. The way accounts, auditors and KYC checks work is that you are supposed to have one unique identifier and all of your appointments associated to that identifier. But if you leave out your middle name it appears that Companies House gives you a second unique identifier and then it’s really easy to conceal interests that you then fail to declare. I’ve noticed this and raised many complaints with Mr Greenberg. He has addressed the failure to declare interests and made those MPs declare those interests but he says that the multiple identities in Companies House is beyond his remit. The suggestion is that you should take it to Action Fraud because it is a breach of Section 1082 of the Companies Act (2006) to have multiple identities, the problem is Action Fraud won’t act on it and when I do compliance assessments of the leadership of Action Fraud I find that (some of them) have multiple identities, so they have no incentive to address it. How could the Committee address this significant breach of transparency as well as breach of the law? Remember that declaring interests in the register of interests is a legal requirements and when you don’t put your interests in the Register of Interest, that’s a breach."

You did not respond to this question, at the time, but I waited and we spoke afterwards. During our conversation, you acknowledged the concern and agreed that it was a serious issue. You reassured me that you would follow it up and suggested I approach the Committee for Standards in Public Life for further comment. However, I am concerned that you were not aware of this issue despite my detailed submission to the Committee's consultation on "Accountability within public Bodies - acting on early warning signs" in April 2024. Here is an excerpt from my submission:

"I have identified widespread use of two simple methods of fraud, employed by individuals in control of these Public Bodies, which have compromised the accounts of every Public Body studied and requires police investigation. However, the compromises extend to the leadership of the fraud and cyber-security investigatory services, which are supplied by the City of London Police through their “Action Fraud” crime reporting system. My repeated attempts to report the methods enabling widespread fraud have been deflected and remain inadequately investigated." (April 2024) My full response is available here: Response to open consultation on Accountability within public bodies - acting on early warning signs.

Could you please confirm whether my response to the Committee's consultation on 'Accountability within public Bodies - acting on early warning signs' in April 2024 was received and processed? If so, could you provide an explanation of what actions were taken or considered in response to my submission?.

While the Economic Crime and Corporate Transparency Act 2023 is a significant step towards improving transparency and reducing economic crime, however, it will not enable the detection or prevent the establishment of multiple identities unless additional systematic measures are implemented to cross-reference and verify identities comprehensively.

Request for Action

Given the severity of this issue and its implications for public sector integrity, I urge the Committee on Standards in Public Life to take the following actions:
1. Conduct a Thorough Investigation: Investigate the use of multiple identities by public officials and the potential breaches of law and ethical standards.
2. Police Investigation: Ensure that individuals found to have multiple identities and who have failed to declare interests are investigated by the police. This investigation should include a full discovery of all their business dealings to uncover any potential fraudulent activities.
3. Collaborate with Companies House: Work with Companies House to implement stricter identity verification processes and cross-referencing mechanisms to detect and prevent multiple identities.
4. Advocate for Legislative Changes: Advocate for any necessary legislative changes to close this loophole and strengthen accountability measures.
5. Enhance Enforcement: Ensure that regulatory bodies, including Action Fraud, are held accountable for addressing these breaches and that there are clear penalties for non-compliance.

Conclusion

The issue of multiple identities in Companies House is a significant threat to transparency, accountability, and the integrity of public life. It is imperative that the Committee addresses this issue promptly to prevent further exploitation by individuals who may be using these tactics to conceal their interests and engage in fraudulent activities.

Drawing on my experience as an IBM Systems Engineer, I must alert you that multiple identities for an individual fundamentally breach accountability and cybersecurity principles. Fraud is the most frequent crime, estimated at £200 billion, and public sector fraud is estimated at £50 billion. Multiple identities, used to conceal interests that fail to be declared, are a fundamental enabler of fraud.

I am certain that you are aware that these breaches by public officials put the public at risk of money laundering and terrorism financing from a cadre of individuals who act with duplicity and have seized positions of control throughout HM Government and the private sector.

Please will you engage with this serious issue which has rendered our systems of governance and accountability compromised?

Thank you for your attention to this critical matter.

Yours sincerely,

Alison Wright.

Brighton.