Verifying a foreign investor helps Ukrainian businesses establish the origin of capital, the ownership structure and the partner’s ability to fulfil its obligations.
When raising foreign financing, the main attention is usually paid to verifying the Ukrainian company. A potential investor analyses financial statements, corporate documents, taxes, litigation, assets and the business model.
However, Ukrainian owners should also verify the party offering the capital. The name of a well-known fund in a presentation or claimed access to significant financial resources does not yet confirm that the negotiations are being conducted by an authorised person or that the money actually belongs to the declared investor.
Before signing an agreement, it is worth verifying the legal entity, the date of its establishment, its executives, owners, corporate group, previous investments and possible sanctions or reputational risks.
Particular caution is required if the investor demands payment of an upfront fee, uses unofficial email addresses, avoids providing corporate documents or proposes making payments through a company that is not a party to the agreement.
D&B third-party verification solutions make it possible to identify a company, analyse its corporate relationships, establish its owners and conduct checks against sanctions lists and other risk sources. D&B Investigate is also used to visualise business relationships and support enhanced due diligence.
“When raising capital, it is not only the Ukrainian company that undergoes verification. Business owners also need to understand who is offering the financing, where this capital comes from and whether the potential investor is capable of fulfilling its obligations,” emphasised Maksym Urakin, Director of Development and Marketing at Interfax-Ukraine, Head of the D&B-Interfax-Ukraine Business Unit and PhD in Economics.
According to him, verification is particularly important for small and medium-sized businesses that do not have their own large legal or compliance department and may perceive the very fact of a foreign investor’s interest as confirmation of its reliability.
The verification result does not replace legal and financial due diligence, but it helps determine whether it is worth proceeding to the costly stage of negotiations, disclosing confidential data and providing access to internal documentation.
Before signing an agreement, it is also necessary to make sure that the representative is authorised to act on behalf of the investor and that the bank account used for the transaction belongs to a party to the agreement or to a duly authorised entity.
Dun & Bradstreet is an international business data and analytics company founded in 1841. Its solutions are used for company verification, corporate ownership analysis, compliance, credit risk assessment and business decision support.
In Ukraine, Dun & Bradstreet is represented by the Interfax-Ukraine News Agency. The D&B-Interfax-Ukraine unit helps Ukrainian enterprises verify potential investors, partners, buyers and suppliers. The agency has operated in the political and economic information market since 1992.
Enquiries can be submitted via D&B’s specialised resource — dnb.ua, by email at Urakin@interfax.kyiv.ua or by telephone at +38 (044) 270-65-74.
