Saturday, October 30, 2010

Increasing Fraud Cases Call for Russia Due Diligence

Moscow private investigators often disagree on just about everything from the best methods to prevent scams and fraud, to the best investigative techniques, to the country's image and transparency. This year all Russian private investigators seem to agree at least on one issue. Risk for business scams and fraud in Russia is at high levels and more investigators and international business consultants advise background checks and due diligence to minimize the risk. There have been too many victims.

The Russian economy has been hit hard after the global economic crisis, and the country's oil revenue has been cut dramatically due to the fall in crude oil prices and the decrease in consumption by importing countries. Crude oil has been making a slow and steady comeback, but Moscow residents are clearly struggling with the post crude oil and credit boom that turned Moscow into the world's most expensive city. International investment is down, and what remains is a high risk environment lacking transparency in business deals, and lots of inefficient and costly red tape. The increase in scams and business fraud have made international business even more difficult, and Russia private investigators are increasingly being used for corporate due diligence.

The most common type of business fraud in Russia is advance fee fraud, and the fees can come in the form of advance lines of credit, pre-payment for goods or services, and down payments, shipping fees, or minimim initial investments. Scammers are increasingly using complex methods to convince their business partners, including meetings in business facilities, government and corporate document, official ID and passports, and more.

International business deals or investment in Russia is a high risk venture, plain and simple. Professional private investigators and business consultants say that doing business without a Russia background check or due diligence to verify the parties involved is like going blind, and can be a costly learning lesson. For criminals, the increase in people seeking opportunity in Eastern Europe has provided a unique and profitable hunting ground, and law enforcement agencies have been slow to respond.

Are there business opportunities in Russia? Absolutely. The advisory from Moscow private investigators to heed extra caution is good advise. Play it safe. Be skeptical and verify.

Best of luck,

A. Hathaway
© 2010 A. Hathaway

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