Legal information = a vital part of risk assessment
Using legal Information in business decisions allows you to check if a potential or existing corporate client appears in any legal context. Enabling you to strengthen your entire onboarding process and lower the risk for bad business decisions. But what should you do when you come across a company involved in a legal context? What are the red flags? And what is the value of historical information?
Statistical increase of relapse into criminal activity
According to statistics from Brå, a Swedish state administrative authority, the risk of relapse into criminal activity increases during the first three years after a served sentence. From 25% in the first year, to 35% in year two and as much as 40% during year three.
Additionally, the statistics presented by Brå also tells us that there’s a difference in the criminal relapse rate, depending on the age of the defendant. There’s a clear spike in the age groups 18-20 years old (32 %) and the group of 21-39 years old (27%).
The importance of historical information
Although a previous verdict isn't a 100% guarantee for criminal relapse, it is a potential red flag that you should look at and investigate further. Check what type of crime that was committed, the age of the convicted person and the amount of years passed since the crime was committed. Then take an informed decision about whether or not this is a person that you want to do business with.
Below are three examples of different cases where a previous conviction has different impacts on your business decisions.
Ex.1 Bank onboarding
A new company customer is looking to sign up and use the services of the bank. However, the legal background checks of the customer show that one of their board members is previously convicted of money laundering.
Ex.2 Supplier control
A supplier procurement between two parts is ongoing and the buyer wants to check the suppliers legal background before signing a deal. The background check comes back with the result of three previous fraud convictions of the beneficial owner of the company's board.
Ex.3 Traffic violation
The company is not involved in any criminal activity. However, a board member is convicted of a traffic violation. Which, perhaps, does not affect either the onboarding process in the first example or the supplier control on the second example.
What is Roaring’s Legal Information API and how does it work?
To help companies minimize the risk of bad business decisions, we’ve created a legal information service. Available either as an API for integration into your system or in our web app. The Legal Information API allows you to check if a potential or existing corporate client appears in any legal context. Enabling you to strengthen your entire onboarding process and lower the risk for bad business decisions.
Helping you provide a smooth onboarding process for your prospects, where screening happens behind the curtains.
Minimizing the risk of fraud and ensure regulatory compliance.
Saving time conducting background checks and due diligence, making sure your business relationship is solid.
Simply enter the Company ID that you wish to check and the API will conduct a search on that company, its board and other official roles. If a record is found, you’re able to collect and download the full legal document (as a Pdf) for further investigation, if needed.
