Companies House crack down on cloned companies in hospitality sector

Helen Mather, Partner

Companies House have reported in their blog on 11 August 2025 that its new powers under the Economic Crime and Corporate Transparency Act 2023 (ECCTA) are “making a real-world impact”. The new powers under ECCTA are part of the governments mission to combat financial and organised crime.

Companies House have reported that between December 2023 and February 2024, it identified 786 existing companies that were suspected to be fraudulent clones of established restaurant businesses and that these cloned companies have used names that closely resemble existing brands often only differing by a single character or punctuation mark.

It is therefore apparent that organised crime gangs are using the reputation of well-known hospitality brands, to give their crimes a veneer of legitimacy. The types of crimes being committed through cloned companies include fraud on suppliers (such as placing large orders) and financial institutions or investors (such as seeking investment or opening business bank accounts under false pretences).

Under ECCTA, Companies House has new powers to:

• query and reject company names that it believes could mislead or imply a false connection with an established business
• intervene by forcing a change of company name when a company is found to be using a name for fraudulent purposes

Companies House have reported that they investigated this activity, flagged companies for enforcement action and have used their powers to give rise to:

• 2,895 fraudulent appointments and 965 companies being removed from the Register of Companies
• the names of 929 companies being changed

Conclusions

Companies House describe the exploitation of businesses through the cloning of legitimate companies as an emerging area of concern.

Due to ECCTA Companies House have better and stronger intelligence and enforcement capabilities enabling it to collaborate more effectively with the police and other regulatory bodies and to increase the integrity of the Register of Companies.

Companies House have said that they’re committed to using their new powers effectively to challenge this misuse of the register and disrupt criminal activity and that they’re strengthening the UK’s company register and helping to build a more transparent and trustworthy business environment.

Cloned companies are clearly a threat to suppliers, investors, legitimate businesses and the public at large who should be able to rely on accurate company information on the Register of Companies when dealing with companies.

It is welcome that Companies House are using their new powers to stop the activities of criminals.

This is a part of wider changes being implemented to tackle financial crime for example, upcoming identity verification requirements for all directors and people with significant control (PSCs) which are aimed at stopping criminals setting up companies using false identities.

If you would like any further information, please contact our Corporate Department.