The purpose of this article is to raise awareness among small and medium-sized businesses of the importance of carefully checking the background of a partner investing in your company.
The EU and the United States have imposed extensive sanctions following Russia’s war of aggression. These sanctions aim to weaken Russia’s ability to continue its brutal war in Ukraine and to isolate the country from the international economy.
But how could these sanctions affect your company?
I would like to share an example of a Finnish SME that was unexpectedly affected by sanctions, with serious consequences. The company had been seeking funding for investments for a long time when it finally found a promising Nordic investor. The investor became a shareholder, and everything seemed to be going well — until the bank started asking for more detailed information about the new shareholder. Soon afterwards, the Finnish bank decided to terminate all of the company’s banking services.
What was behind this situation?
The issue concerned the Finnish SME’s new shareholder and their previous business connections in Russia. As a result, the company lost the ability to pay its running costs and faced a serious crisis. In this case, the right help saved the business, but not every SME is as fortunate. One mistake in background checks can lead to serious problems and even bankruptcy.
As sanctions increase, it becomes ever more important to thoroughly investigate the background of those investing in your company. Oulasvirta Consulting helps SMEs manage risks and avoid pitfalls relating to sanctions and financial crime. Get in touch so we can work together to protect your business against unexpected risks.
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Background: at the time of writing, the EU had adopted 14 sanctions packages against Russia in response to its war of aggression against Ukraine. These packages include a broad range of economic and technological restrictions intended to weaken Russia’s economic and military capabilities. Further information: