Still no fines for SLPs over failure to file information about persons with significant control

Maria Nikolova

Scottish Limited Partnerships, which often front for binary options firms, appear to be successfully avoiding any financial penalties related to failure to comply with rules that came into effect in June 2017.

It has been nearly one year and a half since new regulations were introduced aiming to put an end to the abuse of the status of Scottish limited partnerships (SLPs). These entities are often used by binary options fraudsters. Scottish Partnerships (Register of People with Significant Control) Regulations 2017, which came into force on June 26, 2017, were poised to bring SLPs into line with others in the UK, as they were instructed to disclose the identity of their beneficial owners.

In case the partnerships fail to comply, they face daily fines of up to £500, the original announcement by the UK Government said. However, it turns out that SLPs that fail to comply with the new rules are not fined. This first became clear in July this year.

Now, the questions about SLPs and fines are being raised again. Alison Thewliss of the Scottish National Party, has asked the Secretary of State for Business, Energy and Industrial Strategy, how many fines have been levied against Scottish limited partnerships for failing to register a person of significant control.

Earlier this week, Kelly Tolhurst, a Conservative MP, replied:

“No Scottish Limited Partnerships (SLPs) have been fined since the People with Significant Control register came into force”.

She explained that the primary aim of Companies House is compliance, rather than prosecution. It is taking action to ensure that all SLPs report their PSC information. Companies House is actively engaged with SLPs and their representatives to make them aware of their responsibilities, and in addition, it has issued reminder letters to all SLPs who have failed to file PSC information.

She added that failure to comply with the requirement to report PSC information does not incur a civil penalty but it is an offence and may lead to a fine or imprisonment upon prosecution.

Companies House is not a prosecuting body and will refer cases to a relevant prosecutor when all other avenues have been exhausted and an SLP has not complied with their obligations.

When the new regulations came into effect last year, the UK Government said it estimates that around 30,000 firms registered as Scottish limited partnerships will have to reveal their owners’ identities under the new laws.

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