Response to interpellation 2024/25:1 on unserious actors in company sales
Translated from Swedish by AI; the translation may contain errors. The Swedish text is the original.
Summary AI, written in advance
1 M argues that the government is actively working to prevent criminals from gaining access to companies by strengthening Bolagsverket's control function and cooperation with other authorities 1. 2 M advocates for the criminalization of company hijacking, that the maximum penalty for crimes against the company ban be increased, and that the late fee for annual reports be increased 2. 1 2 M also wants business bans to become more comprehensive through a rapid investigation to stop persons within organized crime from conducting business activities 1 2. 2 M emphasizes that the measures should be taken without creating large costs for honest small business owners 2. 3 C wants stricter penalties for breach of contract in the sale of companies to be liquidated, introduce a license for consultants who mediate companies, send out notices to previous principals, and note changes in direction at Bolagsverket 3. C also advocates for the use of generative AI or machine learning to detect discrepancies in digital reporting. C argues that it is important to make it difficult for criminal companies without making it harder for all business owners. 2 M assesses that much is being done to stifle the criminal economy, but that this area is under-discussed and under-analyzed politically 2. 2 M welcomes all good proposals in order to be able to move forward concretely 2. M emphasizes the importance of staying close to the practical reality to understand how crime proceeds and which vulnerabilities are being exploited. M believes that close dialogue with business owners and other actors in society is important. M also argues that it is important to see how regulations impact in practice and whether the tools have sufficient power.
Written by AI in advance and may contain errors. The numbers lead to the speech a statement builds on; check against the text below.
Justitieministern Gunnar Strömmer (M)
Mr. Speaker! Elisabeth Thand Ringqvist has asked me what measures I intend to take so that companies cannot be sold on in the manner they are today and what measures I intend to take so that business bans become more extensive so that serious criminals cannot start companies once a sentence has been served.
To begin with, it is not uncommon for criminal actors to use companies to earn money through illegal means. The crime and the regulatory violations committed in companies lead to large losses for both society and individuals. Honest business owners are driven out when they compete against unscrupulous or criminal actors, and the profits generated through illegal activities in companies finance other crime. It is therefore that the government is actively working to prevent criminal actors from gaining access to companies to commit crimes.
Part of the government's work against crime in companies involves strengthening the Swedish Companies Registration Office's (Bolagsverket) control function. On April 1, an amendment was made to the agency's instructions, which means that the authority shall now work more actively to ensure that the information in the agency's registers is correct. The amendment has also given Bolagsverket better opportunities to cooperate with other agencies for crime prevention purposes. As recently as a couple of weeks ago, the government also submitted the bill Companies and Crime, with proposals that give Bolagsverket better tools to carry out controls of the company registers.
Through better controls of the registers, Bolagsverket can counteract the use of shell companies to hide the actors who exploit a company to commit crimes. Better controls and better cooperation between Bolagsverket and other authorities can also contribute to preventing other criminal schemes, for example, the systematic brokering of companies for illegal purposes.
Another important part of the work against crime in companies is to ensure that actors within organized crime are stopped from conducting business activities. The Government has recently commissioned an inquiry which, via fast-track, shall produce proposals that make it possible to issue business prohibitions for crimes that have been committed within the framework of organized or systematic crime, even if the crime is not linked to a business activity.
Among the vast majority of business owners, there is a striving to follow laws and regulations. This also applies to those who work with mediating companies. However, those who exploit companies to commit crimes, or enable such exploitation, must be stopped. I follow the developments closely and am not unfamiliar with considering additional measures against crime in companies and those who make such crime possible.
Elisabeth Thand Ringqvist (C)
Mr. Speaker! I thank Minister of Justice Strömmer for the answer.
There are many reasons why well-functioning companies are closed. Closing a company is not like closing a bank account; it is taxes, fees, annual reports, and other things that must be wound down over time. The reasons for liquidation can be many: A company in a group structure may no longer be needed, one may have grown tired of running a company, or a business owner may suddenly pass away and the family is left with a company in their lap.
In the latter case, there are many who have no idea how to handle the company and would like to find a way to manage it. I myself used a liquidation company when a family member passed away, and this despite the fact that I have quite good knowledge of how to run and manage a limited company. It felt simple to ensure for a reasonable price that there was someone who handled all of that. I then received a recommendation from the family's auditor, and everything worked exactly as it should.
I must admit, however, that in moments of grief, I perhaps might not have read the fine print about the fact that the company could potentially be sold. Even if it had stated clearly in the agreement that it was to be wound down and someone had breached that, my incentive to follow up on the matter was absolutely non-existent. It was only when the question was raised in Dagens industri that I checked in a panic whether the company was indeed finished – which it was.
There can also be several reasons why one wants to buy a company with a history. We have those people who have a criminal past, large debts, and difficulty starting a company and gaining access to a bank account. There are people who want to be able to show a company with a fine history and a good income statement and balance sheet in order to be able to participate in public procurements or qualify as subcontractors to established companies.
Just as the Minister for Justice described, the effects of this are very serious: honest companies lose tenders to criminal companies with fake histories, the companies enable criminal activities that far exceed the profits from drugs, and entrepreneurs who sell companies can completely involuntarily become involved in various crimes.
The person who today sells a company that is to be wound up is formally only breaking a clause in a contract, but as I described earlier, the counterparty in the contract has no incentive to follow up that the liquidation takes place. The Swedish Security Service (Säpo) released a very good report last week with many ideas on this theme, and I would like to highlight four concrete measures.
The first is stricter penalties for breach of contract when a company is sold when it was actually supposed to be wound up. The report states: "A specific penal provision regarding trading in falsely wound-up historical companies creates clear frameworks and simplifies crime fighting and can also give the affected entrepreneur better opportunities to assert their rights."
The second measure is to introduce a license for consultants who are to mediate or wind up companies.
The third measure - this is not in the report - means that several previous principals will receive a message from Bolagsverket where the question is asked as to whether everything is actually correct when a company changes its entire board and principal. Then, the previous owners will find out that the company has not been dissolved.
The fourth measure is that it should be noted with Bolagsverket and thus be visible on, for example, Allabolag, that a company is changing its direction. As an entrepreneur, one can then consider whether it is reasonable that a company that has worked with communication suddenly works with construction.
I know that I and the Minister for Justice are not particularly in disagreement on this issue. We both want to see how we can quickly address the problem without – and that is an important "without" – making it super complicated for all those entrepreneurs who are doing and continue to do a good job. My question to the Minister is therefore how he reasons regarding this type of proposal.
Justitieministern Gunnar Strömmer (M)
Mr. Speaker! A big thank you to Elisabeth Thand Ringqvist for raising this question and for us having the opportunity to discuss it here in the chamber as well!
I too have taken note of the reporting in Dagens industri regarding this problem. I have also taken note of the proposals that Elisabeth Thand Ringqvist has put forward in that context, and I simply want to meet that fundamentally by saying that we are prepared to look at all proposals aimed at tackling crime committed in corporate form, including the problem raised in this interpellation.
I also think that the practical description of the nature of the problem that Elisabeth Thand Ringqvist makes here highlights, on one hand, the problem for honest entrepreneurs or co-owners of companies who have an interest in getting rid of a company and, on the other hand, the vulnerabilities that exist in that situation and thus the opportunities for criminal actors to, so to speak, use this space for their criminal purposes.
I note the four proposals raised here by Elisabeth Thand Ringqvist - the stricter penalties, the licensing issue, the provision of information to more people who have had a role in the company in question, as well as the notation of a change in direction in a company. I think all the proposals sound interesting, and we simply have to find a format to look further into them.
The crime we are talking about here does not only have devastating consequences for the individual but is also a significant part of the organized crime that we know today amounts to 100-150 billion, if we are to believe the police's calculations – and I think we have every reason to do so. We also know that the economic crime conducted, among other things, in corporate form also generates the even more brutal expressions of this crime, that is to say, everything from violence to the recruitment of children and young people into the criminal networks.
Let us therefore continue the discussion forward and also look objectively at the proposals that are raised in the chamber today!
Elisabeth Thand Ringqvist (C)
Mr. Speaker! I thank the Minister for the reasoning regarding the proposals.
I note that in the new bill Companies and Crime, there are a number of measures. This involves, for example, not reinstating the audit obligation for small companies. I do not believe that is the right way to go either, and I believe that the things we are talking about here are much more important. It is about not making it harder for everyone but ensuring that we make it difficult for the criminal companies. It is also good that Bolagsverket has been given a much more active role and can now also intervene with tightenings regarding company hijackings and other matters that have been discussed extensively earlier.
In the first round of digitalization, it was very good for the companies; everything became simpler. Digitalization meant that one could integrate their accounting all the way to Skatteverket. In many ways, it has become very good.
In the second round, criminals have exploited the opportunities that digitalization has offered. Therefore, it is very important that we now in the third round ensure that generative AI, or machine learning, can be used so that one ensures that the anomalies that exist are detected when everything is reported digitally. For example, it has been possible to see that Bolagsverket has missed that annual reports with zero results have been submitted on a larger scale than before. This should absolutely be able to be captured by the digital system.
It is this that is so fantastic – deviations from what should be included are sorted out easily. Therefore, it is important that Bolagsverket can meet people in person where there are deviations in order to make an assessment of whether it is the right person with the right purpose.
I want to go into the issue of business bans. We have both read about the case with a corporate broker who was prosecuted by the Economic Crime Authority. Only crimes in 11 out of 1,159 cases could be proven, and in no instance was it the case that a business ban could be imposed. When will business bans be able to be imposed for more types of crimes and on a larger scale, according to the timetable that the government is working with now?
Justitieministern Gunnar Strömmer (M)
Mr. Speaker! I want to first say a few words about the Swedish Companies Registration Office (Bolagsverket) and its role in this, in light of what Elisabeth Thand Ringqvist raised in our exchange of views. I want to confirm the importance of strengthening the Companies Registration Office's control function, without, for that reason, introducing regulations that will primarily come with a very large cost for honest small business owners and thus for the competitiveness in Sweden's economy and society as a whole.
I move on to what we presented to the Riksdag in September regarding companies and crime. We highlight that Bolagsverket, in order to ensure that it is the correct representative, shall be given the opportunity to demand personal appearance from the person who reports a representative to the agency's register. Corporate hijacking is criminalized. The maximum penalty for crimes against the company prohibition is increased. The late fee regarding the late submission of annual reports is increased.
Furthermore, we say that all housing cooperatives and other economic associations must also submit their annual reports to the Swedish Companies Registration Office (Bolagsverket). This is a reminder that it is not only companies that are used as tools for crime, but almost all legal structures - both commercial and non-profit - that create a platform for criminality.
The business prohibition is today an all too blunt tool, which is underscored in some of the cases raised here in the discussion, and it can be used in all too few cases. As I said, the government has commissioned an inquiry in a fast track. This is a narrow and pointed issue that can be investigated intensively over a short period. I cannot say in any way whether the inquiry period ends on this side of the turn of the year or on the other side, but it is in any case a shorter process than usual. This means that in any case, during the next year, we will be able to have proposals that we will then be able to handle in relation to the Riksdag.
There is no doubt that persons who have committed serious crimes within the framework of organized crime should not have the opportunity to acquire companies to continue their criminal activities in this format, even if the crime has not previously occurred in business activities.
I would finally like to say that I noted in Dagens industri – there is a lot of reference to Dagens industri here – that Elisabeth Thand Ringqvist raised another issue that I believe is very important, namely the importance of a clear governance of our authorities in these parts. The government, of course, has both regulatory letters and specific agency mandates at its disposal. As far as Bolagsverket is concerned, we have already in the regulatory letter that applies for this year clarified the importance of moving forward positions when it comes to crime prevention work. With the new functions and mandates that follow from these legislative changes, Bolagsverket also receives a specific mandate to ensure that the tools that are now being put in place gain full traction in practice.
Overall, I assess that we are doing very much to choke the criminal economy. Of all the problems we handle, I would say that this is perhaps the most under-discussed or under-analyzed, also politically. Not least from that perspective, all good proposals are welcome. We will handle them in the best way possible to move forward with them concretely.
Elisabeth Thand Ringqvist (C)
Mr. Speaker! I thank the Minister for the description of what we are to do moving forward.
Since this is an area that is under-analyzed and under-discussed, I believe it is important to have one's ear to the ground in many areas. When I was previously CEO of Företagarna, fake invoices were high on the agenda. That was about 13 years ago. At that time, we didn't quite understand how large the problem with fake invoices was. It was something that one was supposed to be a bit ashamed of, before one realized that it was systemic. Many of us were then who gathered authorities and entrepreneurs to gain insight into what was actually happening out there in the field. Then one could also act quickly.
I believe it is important to continue with such conversations to hear how things are working out in the field. Many times, it is probably entrepreneurs who see certain parts of this abuse, which takes some time for authorities to discover, because authorities are so fragmented. I look forward to a continued discussion on these issues.
Justitieministern Gunnar Strömmer (M)
Mr. Speaker! I thank Elisabeth Thand Ringqvist again for the opportunity to discuss this very essential issue today. I want to emphasize what Elisabeth Thand Ringqvist pointed out at the end, namely the importance of staying very close to the practical, concrete reality in order to as quickly as possible and with as much precision as possible get an understanding of how this crime proceeds and which vulnerabilities are used and abused for criminal purposes. This can also apply to good insights regarding how these problems can best be managed and addressed.
I really want to emphasize the importance of having a close dialogue with individual entrepreneurs and representatives of the business community in this. I think we learn a lot by staying close to both the law enforcement actors and other actors in society who work with these issues and seeing how it impacts.
It is also important to see how regulations take effect in practice, not least in judgments in our courts, which show to what extent our tools reach all the way through or if they in fact do not have the power required to address these problems. There are a number of cases recently that suggest we have a long way to go before we can say that our toolbox is so sharp and effective, and represents such an extensive impact in practice, that we are where we want to be when it comes to our efforts to choke the criminal economy.
Thank you very much, Elisabeth Thand Ringqvist, for today's discussion! We must continue the joint work forward.
Source: The Swedish Parliament. The speeches come from the open data of the Riksdag, translated into English by AI, which may contain errors.