The existence of a global network of sham company directors, most of them British, was revealed yesterday by an investigation into an obscure practice that helps keep secret countless financial transactions. The UK government claims such abuses were stamped out long ago, but a worldwide joint investigation by the London-based Guardian , the BBC's Panorama and the Washington-based International Consortium of Investigative Journalists (ICIJ) has uncovered a booming offshore industry that leaves the way open for both tax avoidance and the concealment of assets. More than 21,500 companies have been identified using a group of 28 "nominee" directors. The nominees play a key role in keeping secret hundreds of thousands of commercial transactions. They do so by selling their names for use on official company documents, using addresses in obscure global locations. This is not illegal under UK law, and sometimes nominee directors have a legitimate role. But evidence suggests this group of directors only pretend to control the firms they put their names to. The companies themselves are often registered anonymously offshore in the British Virgin Islands (BVI), but also in Ireland, New Zealand, Belize and the UK itself. More than a score of UK agencies sell offshore companies, several of which also help supply sham directors. One British couple, Sarah and Edward Petre-Mears, who migrated from Sark in the Channel Islands to the Caribbean island of Nevis, have sold their services to more than 2,000 entities, with their names appearing on activities ranging from Russian luxury property purchases to pornography and casino sites. In 1999, the British government claimed the sham director industry had been "effectively outlawed" after a judge, Mr Justice Blackburne, said the court would not tolerate "the situation where someone takes on the directorship of so many companies and then totally abrogates responsibility". But this ruling has failed to be policed. The nominee fronts conceal a wide variety of real owners, including those that are perfectly legal, from Russian oligarchs to discreet speculators in the British property market. In a parallel investigation the BBC's Panorama is due to show a company formation agent offering to assist an undercover reporter to escape tax. The agent, James Turner, of Turner Little in York, offers nominee directors in Belize and says: "They won't even know that they were a director, they just get paid." A worldwide research effort was launched this year by the ICIJ to identify thousands of the true owners. The Guardian has collaborated with the ICIJ, a non-profit organisation, to analyse the British data, and the ownership data will be released this week. The ICIJ identified the 28 nominee directors by using computer software to filter hundreds of thousands of company documents in search of patterns. Gerard Ryle, the director of the ICIJ, believes the project, when it is completed next year, will haul into the open a shadowy financial system estimated to conceal the movement around the world of trillions of dollars.