While conducting IntegraCheck® | Integrity Due Diligence at the Client’s request, we found that the target company was purposely and fraudulently, using the credentials of a legal representative who had died five years to secure contracts, avoid legal liabilities and illegally stay in business.
Using our team’s local expertise, insights and country knowledge, we informed the Client that operating with a dead or inactive legal representative may lead to the revocation of a business licence by local authorities, thereby heightening the possibilities of business interruptions and financial losses.
Failure to alert authorities of the status of its legal representative may entail that the target company is trying to avoid legal liabilities levelled against it and its legal representative.
After extensive and thorough analysis of related documentation, Case Managers, Alec Cheung and Alex Chow, highlighted the business risks of doing business with entities whose legal representatives are dead, and why enhanced due diligence is a better option in China.
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Alec is one of our Greater China region specialists based out of Shanghai, China. He focuses on compliance controls in China’s medical industry and has completed numerous compliance due diligence projects across multiple industries.
Alex has conducted dozens of cases ranging from FCPA/anti-corruption due diligence to internal investigations for multinational companies, law firms, regulatory bodies and financial institutions. His focus is in Greater China, where he has been based for eight years and has developed an understanding of local compliance laws and regulations.