Economic crime, scam companies, and company ownership among gang criminals are becoming increasingly common, which underscores the importance of protecting yourself against unscrupulous business relationships. Pontus Holmberg, Head of Product and Innovation at Roaring, shares strategies for business owners to avoid doing business with unscrupulous or criminal actors.
Economic crime, scam companies, and gang-criminal business owners are an increasingly greater reality in today’s society. In an article from 23 November, SVT Nyheter Stockholm mapped people with links to gang criminality and their ownership in companies. Of the 591 people included in SVT’s mapping of gang criminals, 57 people own 68 companies. Organized crime is exploiting companies to an increasing extent in order to launder money from other criminal proceeds and conceal traces of criminal activities.
Of the business owners examined in SVT’s mapping, the majority, 46 of 57 people, have been convicted of violent crime, drug offences, or weapons offences. But how can serious companies protect themselves and avoid doing business with unscrupulous, or even criminal, actors? Pontus Holmberg at the SaaS company Roaring, which provides business-critical information, explains how.
“We see that it is becoming increasingly important for companies to protect themselves. If you are going to do business with a company, my first tip is to relate to a few hygiene factors. Review data connected to the company in question and start at the right end to find out whether you are dealing with unscrupulous actors; that way you protect yourself in the best possible way,” says Pontus Holmberg, Head of Product and Innovation at Roaring.
Begin the analysis with basic factors
The first thing one should examine is legal information, F-tax status, and VAT registration. The initial review provides an indication of whether it is necessary to deepen the investigation. It is good to check whether the company has frequently changed address or whether there are continuous board changes. These factors show that it is time to look more deeply into the business.
“One tip is to start with the soft data that gives an indication of a company’s reliability and whether it is time to proceed with the analysis. If address changes happen often and there are continuous changes on the board, it is probably time to prick up your ears. It does not necessarily have to be something negative, but it is time to ask questions,” says Pontus Holmberg, Head of Product and Innovation at Roaring.
Map connections to the company and convictions
In a next step, one should map which people are connected to the company and what additional company connections they in turn have. Do the newly discovered companies in turn have other people connected to them? Review whether the representatives in the different companies have been involved in legal contexts, whether there are convictions against these people, and if so, what crimes they have been convicted of.
“By investigating previous convictions and links to other companies, you can gain a deeper understanding of an individual’s and a company’s credibility. In that way, you create a fair picture for yourself and can deepen the analysis. When it comes to convictions, it is of course important to look at what type of conviction it is, since some do not need to mean that something is not right,” says Pontus Holmberg, Head of Product and Innovation at Roaring.
If you still feel uncertain, you can expand the investigation further and review other assignments held by the board members, as well as their legal information. What does the business look like for these companies and which people are connected to them?
“It may sound like a long and unbearable process, but the fact is that it does not need to take a long time. Structuring the analysis and knowing what to look for makes it go quickly, and one tip is to do spot checks instead of analyzing all the data,” says Pontus Holmberg, Head of Product and Innovation at Roaring.
Current-state picture through Open Banking
A traditional credit report is based on historical data and therefore provides a historical overview. To instead create a current picture of the business, which reflects the present situation, one can use Open Banking data. This means that a third-party actor, with approval, retrieves information about the company being examined and accounts linked to it.
“By gaining access to transactions and other account information, you can determine whether what the company says is actually true. If, for example, you are going to lend money to another company, is it then not reasonable to look at up-to-date data? If you are denied access to the company’s account and transaction data, it is once again time to ask questions,” says Pontus Holmberg, Head of Product and Innovation at Roaring.
By following these steps and making use of available data, companies can create a strong current-state picture and thereby reduce the risk of unscrupulous or criminal business relationships.
Read the article in Aktuell Säkerhet.
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Roaring, established in 2016, is a leader in automated customer and supplier checks with a focus on minimizing business risks. Through smooth access to business-critical information, Roaring ensures regulatory compliance and strengthens organizations’ risk assessments – and can at the same time contribute to a seamless onboarding of new customers. All for a world without time-consuming, frustrating, and unnecessarily complicated business-critical processes.
Roaring is ranked as the 14th fastest-growing technology company in Sweden according to Deloitte Sweden Technology Fast 50. During the most recent financial year, Roaring grew by nearly 50%, and the goal is even faster growth in the coming year. Roaring’s headquarters are located in Danderyd, Stockholm.
For more information, please contact:
Sandra Siljestedt
sandra@roaring.io
+46 707-42 42 98
