Understanding the Economic Crime and Corporate Transparency Act (ECCTA): A Guide to Compliance

What is the Economic Crime and Corporate Transparency Act (ECCTA)?

The Economic Crime and Corporate Transparency Act (ECCTA) is a landmark piece of legislation designed to tackle financial crime, improve corporate transparency, and strengthen the UK’s financial regulatory framework. It introduces stricter reporting obligations, enhances law enforcement powers, and increases corporate accountability—making compliance more critical than ever.

If your organisation is subject to financial regulations, now is the time to ensure you understand what ECCTA means for you. This guide will break down the key elements of the Act and how you can stay compliant.

Why Was ECCTA Introduced?

Financial crime has long been a significant issue in the UK, with illicit funds flowing through companies and trusts. The ECCTA is the government’s response to:

• Strengthen corporate transparency, ensuring businesses operate with integrity
• Prevent money laundering and fraud by tightening regulations on company ownership and financial transactions
• Give regulators greater enforcement powers, making it easier to identify and prosecute financial crime

Failure to comply with the ECCTA can lead to significant penalties, reputational damage, and potential criminal liability for company directors and officers.

Key Compliance Requirements Under ECCTA

1. Stricter Identity Verification for Company Directors

One of the biggest changes under ECCTA is the requirement for company directors, PSCs (Persons with Significant Control), and certain professionals to verify their identity through Companies House.

What you need to do:

• Ensure directors and PSCs undergo identity verification through an approved process
• Review and update corporate records to reflect these changes

2. Increased Transparency in Company Ownership

The Act tightens rules around corporate structures and beneficial ownership to prevent shell companies from being used for illicit purposes.

What you need to do:

• Maintain accurate and up-to-date records of beneficial ownership
• Report any discrepancies to Companies House promptly

3. Enhanced Reporting Obligations

ECCTA introduces more rigorous reporting requirements to combat fraud and economic crime, including:

• Tougher filing rules for financial accounts
• Increased scrutiny of business transactions
• Stricter anti-money laundering (AML) procedures

What you need to do:

• Implement robust internal compliance and training programmes
• Ensure your team understands FCA training requirements

4. Tougher Enforcement and Penalties

Regulators now have greater powers to impose sanctions, freeze assets, and investigate financial crimes. Non-compliance could lead to hefty fines or even criminal charges for company officers.

What you need to do:

• Regularly review your compliance procedures
• Conduct compliance training for employees to ensure they understand the risks and their responsibilities

How Compliance Training Helps Your Business Stay Ahead

Keeping up with regulatory changes like the ECCTA can be overwhelming, but investing in the right compliance training ensures your organisation stays compliant while reducing risk. Choosing the right training provider and LMS is key. 

• Compliance courses keep your team updated on new regulations
• FCA training ensures financial services professionals meet the latest standards
• Compliance and training programs reduce the risk of financial penalties
• Compliance training fosters a culture of integrity and accountability

Next Steps: Ensuring ECCTA Compliance in Your Organisation

The Economic Crime and Corporate Transparency Act represents a major shift in corporate regulation. Businesses must take proactive steps to ensure compliance and protect themselves from legal and financial risks.

Actionable Steps for Businesses:

• Review internal processes and identify gaps in compliance procedures
• Train your team with compliance courses covering ECCTA
• Ensure FCA training compliance, particularly for financial services firms
• Verify directors and PSCs in preparation for identity verification requirements
• Stay informed, as regulatory changes continue to evolve

Investing in compliance training today will save your business from costly consequences in the future. If you need help with compliance and training, explore our range of compliance courses designed to help businesses navigate ECCTA effectively.

Stay compliant, stay protected.

Would you like to learn more? Get in touch for expert-led compliance training.