Central Asia: Integrity Due Diligence. Third Parties Risks. Your Trusted Advisors for Central Asia International Investors Solutions: Managing Your Risks in Central Asia Doing Business in Central Asia: Kazakhstan, Kyrgyzstan, Uzbekistan, Tajikistan, Turkmenistan.

Corruption is pervasive in several countries of Central Asia, where a majority of respondents say they are either asked or are expected to pay bribes to receive public services...

If your company’s business is carried out in one of the post-Soviet Central Asian countries like Kazakhstan, Kyrgyzstan, Uzbekistan, Tajikistan, or Turkmenistan, then

Making your corporate ethics policies understood and routinely referred to by employees at your local offices in Kazakhstan, Kyrgyzstan, Uzbekistan, Tajikistan, and Turkmenistan is a huge challenge. Solving this challenge means getting rid of foreign corruption exposure

Sarsenov Corporate Governance Advisory
Compliance in Kazakhstan, Kyrgyzstan, Uzbekistan
Corporate Governance & Compliance Services
Third party due diligence in Kazakhstan, Kyrgyzstan, Uzbekistan

Advising On Third Party Risks in Central Asia

Potential reputational risks and integrity concerns should be approached very seriously in Central Asia. Such risks here can be usually associated with dealing with local clients, vendors, suppliers, local consultants, joint venture partners.

According to KPMG’s 2013 analysis*, Central Asia is shown to be among the three most dangerous geographical regions, with the highest—70%—red reports in financial sector companies’ integrity due diligence. Same report says that Central Asia stands out from other regions as showing the highest third-party risk—53%—of all third-party reports by KPMG in Central Asia.

We can advise you on intergity prblems in any country of your operation in Central Asia, and/or develop and provide special trainings for those of your managers involved in dealing with Central Asian businesses.

As a compliance expert that is well familiar with specifics of local culture, languages in Central Asia and, at the same time, staying at the cutting edge of all current international trends in corporate compliance we have conducted many Compliance Audits and Due Diligence projects in Central Asia.

We did Integrity Due Diligence in respect of large-scale lending/investment Kazakhstani and CIS projects (from US $5,000,000 to $2,000,000,000).

We’ve conducted specialized due diligence for over $100 million Special Investment projects in Central Asia.

We helped to prevent $1.5 billion transactions with serious legal, corruption, environmental, and ethical concerns. We conducted full-scale conflicts of interest checks, compliance clearance, third party due diligence, and prospect borrower/investee due diligence.

In total, we’ve provided our due diligence services for more than $7 billion finance and investment projects across Central Asia.

The major integrity problem here in Central Asia region is generally related to a hidden opaque ownership structures normally used in business. Dealing with local companies you sometimes may be even not aware who is the ultimate beneficial owner of this particular business you are dealing with. So the odds are high to ending up doing business with corruptive government officials, inadvertently, of course. But who would care about it if your company violated FCPA or UK Bribery Act? Even worse, your company may become easily get to be involved into money laundering schemes. Again, inadvertently. Believe us or not, you might even not have a clue of you doing that. But both Ministry of Justice and SEC, or SFO (in case of UK) barely going to be kind and understanding that when it happens.

The hidden presence of politically exposed persons (PEPs) among local businesses is a vastly popular thing. Often, only the word of mouth and artful networking with local experts can help you to save a day in this kind of situations. It is also worth noting that lots of proposed projects do not proceed here due to integrity concerns.

Sometimes even local offices of big consulting firms might be doing not very ethical business while serving their international clients here. In one recent case, a big consulting firm, even having its own local office here, was looking for local partner for doing “dirty job”. That job was actually about obtaining all licenses and permissions for international client in its big construction project.

Bribery blossoms here. Under the guise of normal business firms, in reality, you may reveal a firm embedded into various levels of corruption chain.

Because of incredibly higher reputational risks in Central Asia, your compliance department is better to have increased levels of scrutiny and provide the most clear guidance to local suppliers, vendors, partners as to what is not acceptable practice in doing business with your company.

We can assist your office in doing third party due diligence locally within Central Asian countries, or we can conduct third party due diligence for you on our own.

If a wrongdoing at one of your Central Asian locations was reported or detected by your system and you are now initiating a new investigation, we can help you by assisting in local part of an investigation.

If you want to stay updated on compliance risks in Central Asia and about possible ways of mitigating your risks, you may subscribe to our alert service — Compliance Updates from Central Asia — which will regularly provide you valuable compliance developments from Central Asia. This service is free.

Compliance Updates from Central Asia

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Phone: +1 (718) 289 4134

Email: cga@sarsenov-advisory.com