When can The Service investigate?
Note – the following information relates to the investigation of companies that are actively trading, or which have ceased trading without entering into insolvency proceedings, using powers of investigation under the Companies Acts. For information on investigations into companies which have entered into formal insolvency proceedings see our pages on Insolvent Companies.
The Insolvency Service does not only investigate the affairs of companies that are subject to insolvency proceedings. It can also investigate companies that are actively trading, or which have ceased trading without entering into insolvency proceedings, using powers of investigation under the Companies Acts. There must be reasonable grounds to suspect fraud, serious misconduct, material wrong-doing or significant irregularity in a company's affairs for us to investigate.
Please note – ‘company’ can also refer to a Limited Liability Partnership.
The Service can investigate:
Limited companies and limited liability partnerships that are active and have a business address in England, Wales, Scotland or Northern Ireland, including overseas registered companies which are operating within the UK.
Investigations are fact finding in nature. They are not criminal investigations, although they may address conduct which could amount to criminal behaviour. Our approach is to take a proportionate and realistic view of issues brought to our attention, and to investigate aspects of corporate behaviour which might harm both the business community and the public generally. With this in mind we wish to know about the activities of any company which appears to be causing significant harm to consumers, trade suppliers, service providers, investors etc., who have had dealings with it. Also where there is any strong indication of serious misconduct in the management or affairs of a company.
Such activities would include companies that:
- Are set up for an illegal or improper purpose (‘Sham’ companies);
- Engage in, mainly consumer targeted, ‘scams’ where there is little or no intention of supplying or providing the ‘products’ promised;
- Promote, advertise or otherwise participate in bogus investment schemes or other ‘get rich quick’ opportunities;
- Engage in asset stripping operations;
- Target vulnerable groups using high pressure selling techniques;
- Take fees, deposits or other advance payments, in circumstances where there is little or no reasonable prospect of providing the goods or services offered;
- Falsely claim to ‘ring fence’ or otherwise protect customer or client monies/funds in their possession;
- Falsely claim to honour guarantee or warranty obligations;
- Falsely claim official status, approval, authorisation, bonding, licensing etc., from or by a government or other official body;
- Falsely represent, or otherwise abuse charitable, educational or religious status;
- Falsify their accounts, documents of contract or account, or security or references etc. In order to present their affairs more favourably;
- Improperly (and successfully) evade debt and/or transfer assets at under value to the detriment of third parties who have dealt in good faith;
- Are managed or controlled by persons who are prohibited, by law, from participating in the control or management of a company’s affairs;
- Are improperly managed such that reputational damage to the UK corporate regime is likely to result.
You can lodge a complaint or provide information of undesirable activity or behaviour in a variety of ways. See the section about "How to complain about a company".
