Serious and organised crime

Why is this a risk?

Knowing the background and current activities of suppliers and their principals is an important aspect of building a business relationship. Any ongoing investigations or convictions for serious compliance violations (such as terrorism, arms trafficking, involvement in organised crime and other first-degree infractions by the supplier) could pose serious reputational risks as well as involve your business in costly legal actions. Even if those infractions took place prior to your engagement with the supplier, the court of public opinion will likely associate your business with the incident.

In many jurisdictions there is a legal requirement to perform a suitable level of due diligence to ensure that you are not financing organised crime in any way. For example, in areas in Japan there are several local laws that aim to limit income going to 'anti-social forces' such as the Yakuza by targeting firms that knowingly do business with them.


Examples of where this risk could affect you

  • A principal of one of your suppliers has an ongoing investigation for a major compliance violation
  • A principal of one of your suppliers has been added to a watchlist
  • A supplier is being investigated for human rights violations


What sort of suppliers could be engaged in this risk area?

  • Suppliers operating in politically unstable countries

  • Suppliers with operations in countries known for major human rights violations and terrorist activities
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Sanctions & exclusions
Sanctions & exclusions

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