For most UK firms, know your business (KYB) checks start with one place: the Companies House register. It is free, fast and a natural first step when onboarding a new corporate client, vendor or partner. But treating a Companies House search as the whole of KYB can leave important gaps, particularly when regulators ask how a risk decision was reached.
Why a registry check alone falls short
Companies House is primarily based on information filed by companies and their officers, although recent reforms have strengthened identity verification and the accuracy of the register. It provides important information about a company's existence, incorporation, directors and people with significant control (PSCs).
What it cannot always establish on its own is whether the information is complete, accurate and sufficient for a firm's specific risk assessment at the point of onboarding.
For regulated firms within scope of the Money Laundering Regulations 2017, customer due diligence (CDD) obligations apply before establishing a business relationship with a corporate client. That risk-based approach does not stop at confirming that a company number matches a company name. It can also require firms to understand who ultimately owns and controls the entity, verify relevant individuals, screen them and assess risk using information beyond a single public filing.
The ownership picture is rarely simple
The 25% threshold for identifying people with significant control can look straightforward until a firm has to apply it. Control can be established through voting rights, powers to appoint or remove directors, or other forms of significant influence or control, not only through direct share ownership. Establishing the full picture may therefore require reviewing shareholder agreements and governance documents that do not appear on the public register.
It becomes more complicated when a shareholder is itself a corporate entity. In those cases, tracing the ultimate beneficial owner may mean following an ownership chain through one or more additional layers, potentially across jurisdictions, before reaching an individual who can be verified and screened.
Trust structures can add another layer of complexity. Settlors, trustees, protectors and beneficiaries are not necessarily visible through a single public source, leaving firms to request supporting documentation or cross-reference multiple sources to establish who is ultimately behind the entity they are onboarding.
Verifying the business itself is therefore only one part of KYB. Firms may also need to establish and verify the identities of relevant individuals behind an entity, including beneficial owners and controllers, before the risk assessment can be considered complete.
Ongoing monitoring is not optional
A KYB check at onboarding is only the starting point. For regulated firms with an ongoing business relationship, ongoing monitoring is a regulatory requirement, not simply a best practice. Firms may need to keep business and beneficial ownership information up to date and identify changes that could alter the risk associated with a relationship.
That can include new PSC filings, ownership restructuring, changes in control or shifts in customer activity that may indicate a change in risk. A company that appeared low risk at onboarding can look very different months later if, for example, a new controlling shareholder has links to a sanctioned jurisdiction. That kind of change can only be identified if firms have processes in place to monitor for it.
A 2024 enforcement action against UK digital bank Starling illustrates the broader consequences of gaps in financial crime controls. The bank was fined close to £29 million after the FCA found serious weaknesses in its financial sanctions screening controls and breaches relating to high-risk customers. While it was not a direct example of PSC monitoring failure, the case demonstrates what can happen when screening and onboarding controls do not keep pace with customer growth.
Where automation closes the gap
This is where relying on a single registry, however valuable, becomes a limitation rather than a complete safeguard. Firms need a way to verify company identity and trace ownership structures without manually cross-referencing multiple sources for every new relationship and periodic review.
Melissa's Know Your Business (KYB) solution is designed to address that gap. It verifies company name, address and business ID against government sources across multiple countries and regions, helping firms go beyond what a single domestic register can confirm.
Screening can run alongside verification, covering PEP, sanctions and watchlists, including OFAC-related sanctions data, as well as adverse media. Risk assessments can be automated to accept or reject a business based on a firm's own risk appetite, reducing the manual review burden that comes with tracing ownership and screening entities by hand.
Because the checks can run through a single API or as a no-code service for firms that do not want to build custom integrations, onboarding and ongoing monitoring can sit within the same workflow rather than operating as disconnected processes.
That matters for record keeping too. Under the Money Laundering Regulations 2017, regulated firms are generally expected to retain records of the due diligence carried out for a minimum of five years after a business relationship ends. A structured, repeatable process can make that documentation easier to maintain and produce than a collection of manually gathered screenshots and PDFs.
Getting past the surface-level check
A Companies House search remains a sensible first step for UK firms conducting KYB. It is quick and free, and it provides an important baseline for verifying a company's registered information. But it was never intended to carry the full weight of a regulated firm's due diligence process, particularly when complex ownership structures, cross-border entities or trusts enter the picture.
Firms that build their KYB process around a broader, automated verification layer can put themselves in a stronger position to make faster onboarding decisions, identify changes in risk and demonstrate, when required, how those decisions were reached.
Learn more about Melissa's Know Your Business (KYB) solution.