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Blog 3 August 2023

Compliance during the war: prioritizing initial checks

Compliance during the war: prioritizing initial checks

The impact of martial law in Ukraine has led to a shift in the landscape of business due diligence and compliance assessments. We engaged with department heads and the CEO of YouControl to uncover their insights on prioritizing checks to mitigate potential risks.

Key Compliance Points According to the CEO


  1. Express analysis: Emphasizing a swift evaluation, focusing on connections with Russia, Belarus, and entities under sanctions.

  2. Financial Resilience: Assessing the company's financial stability.

  3. Market Presence: Scrutinizing the company's market share.


Tools and Resources for Thorough Verification:

The Express Analysis tool promptly directs attention to critical facets of the counterparty's operations warranting thorough scrutiny. With an assessment of 550 risk factors, this tool gauges the risk level of the counterparty.


In times of war, associations with sanctioned nations, legal entities, and individuals become paramount.


FinScore, a system evaluating a company’s financial endurance, relies on 20 financial indicators providing a comprehensive overview of liquidity, solvency, profitability, and business activity in relation to market competitors. These indicators hold the highest predictive power for gauging the likelihood of a company's bankruptcy.


MarketScore index reflects a company’s market share, industry standing, and growth dynamics compared to its rivals. Developed by YouControl's analytical department, this scoring index gauges a company's market influence through 10 indicators. This information can be found in the counterparty’s profile under the “Financial/Market Scoring” section.


A Legal Perspective: 5 Key Compliance Checks


  1. Company Registration: Duration of activity, operational status, and location, along with scrutiny of participants (shareholders) and ultimate beneficial owner.

  2. Ties with Russia or Belarus: Partnerships with contractors linked to these countries may be seen as support for military aggression against Ukraine, potentially leading to sanctions.

  3. Potential Sanctions: Assessing potential sanctions that might affect the company or its shareholders.

  4. Legal Decisions: Scrutinizing court decisions and enforcement proceedings involving the counterparty.

  5. Licensing and Permits: Verifying licenses and permits if the business type necessitates them.


Tools and Resources for Thorough Verification:


The Unified State Register provides primary data verification with your key, though recent restrictions by the State Tax Service of Ukraine have made access more challenging. Alternatively, comprehensive registration details, authorized personnel, activity types, and vital data can be found in the YouControl system under the counterparty's profile.


Sanctions lists, court cases, and enforcement proceedings are accessible through the respective sections in the YouControl system.


Financial Insights: 3 Compliance Checks by the Financier


  1. Financial Health: Evaluating the company's financial standing.

  2. Debt Evaluation: Checking for outstanding debts.

  3. Enforcement Cases: Scrutinizing any legal actions involving the counterparty.


Tools and Resources for Thorough Verification:


Debt presence can be confirmed through the Unified Register of Debtors and the Tax Service website. Note that the State Tax Service restrictions limit access to electronic registers. However, risk factors are still accessible through YouControl's Express Analysis.


Analyst's View: 3 Compliance Checks


  1. Financial Assessment: Understanding a company's profitability, liquidity, solvency, and business activity.

  2. Market Performance: Tracking revenue and market share growth to gauge performance trends.

  3. Connections with Financial-Industrial Groups (FIGs): Recognizing that FIGs face heightened risks when dealing with diverse counterparties.


Tools and Resources for Thorough Verification:

Financial indicators and analyses, including return on assets, debt ratios, and profit growth, can be explored in the Finance section of a legal entity's profile on YouControl.


The MarketScore tool, based on 10 indicators, gauges a company's market influence, industry position, and growth dynamics relative to competitors.


Sales Considerations: 2 Compliance Points


  1. Company Debts: Highlighting debts that may signal potential non-repayment of trade credits.

  2. Legal Involvement: Screening for lawsuits or legal proceedings at the outset to avoid wasting time on high-risk counterparties.


Tools and Resources for Thorough Verification:

Tax debt and legal involvement details can be checked within the company's profile under Taxation and Courts tabs, respectively. Utilizing automatic Monitoring can help promptly identify new court cases or lawsuits involving a counterparty.


HR Focus: 4 Compliance Checks


  1. Candidate's Court Records.

  2. Debts and Legal Proceedings.

  3. Wanted List: Historically listed individuals not available on the Ministry of Internal Affairs website.

  4. Collaborative Engagements and Reputation: Checking the Myrotvorets database for links to money laundering, corruption, or other illegal activities to mitigate reputational risks.


Tools and Resources for Thorough Verification:


The YouControl People check reveals court cases, pending proceedings, offenses, media mentions, and more. These checks are crucial, especially during times of heightened risks.


In Conclusion:

These comprehensive checks, as recommended by various experts, offer valuable insights when time is limited. Neglecting due diligence is not an option, particularly in periods of elevated risks.


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News 15 November 2017

Ukrainian companies originating in Russia that are involved in trade in weapons will fall under the U.S. sanctions

YouControl’s analysts hereby present the list of Ukrainian companies which will fall under the sanctions to be imposed by the U.S. Department of State as early as from 29 January 2018.   The U.S. Department of State has imposed sanctions on 33 Russian companies. Restrictions also apply to Ukrainian businesses founded by Russian companies now under sanctions, such as Izhmash Concern JSC, Izhevsk Mechanical Plant, Russian Aircraft Corporation MiG Joint Stock Company.

News 26 October 2017

161 Ukrainian companies have been included in 5 worldwide sanctions lists

Since 25 October, the YouControl system provides its users with a unique opportunity to be the first to learn whether their business partners are included in 5 worldwide sanctions lists. Ukrainian branches of Russian banks such as Sberbank, Prominvestbank, VTB Bank are listed in the U.S. and Japanese sanctions lists. What particular sanctions lists are added in the YouControl system? 1. Sanctions list by the United States Department of the Treasury 2.

Blog 12 April 2022

9 Signs of Evasion of Sanctions According to the U.S. Department of the Treasury

The Financial Crimes Enforcement Network (FinCEN) of the U.S. Department of the Treasury advises financial institutions to increase vigilance because of russia’s attempts to evade sanctions. The FinCEN published a list of signs to identify such companies, as well as those that may be involved in terrorist financing and financial schemes. This list can be used to detect suspicious counterparties. Context:

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