Banks now monitor you on the internet

Banks now monitor you on the internet. But how and why? If you have a foreign company that still needs a corporate website and search results about your activities are almost nonexistent on Google, we have some not-so-pleasant news for you. The absence of information about your business online, or worse, negative mentions about your company, key employees, clients, or suppliers, can hinder your successful passage through the adverse media screening which many banks are actively using.

The experts at Antwort Law are always focused on keeping you informed, helping maintain your business reputation, and supporting your business. In this article, we will share why banks have started monitoring your online reputation and how to navigate this new type of banking scrutiny successfully.

Adverse media screening has yet to be widely known to entrepreneurs in the CIS, but it is already becoming a standard practice worldwide. This monitoring originates from documents of international regulatory bodies, such as the EU's Fourth Anti-Money Laundering Directive and the Financial Action Task Force's recommendations to combat money laundering, terrorism financing, and other threats to the integrity of the international financial system. According to these directives, financial institutions should conduct additional scrutiny of their clients' reputations, including online.

All bank clients are conventionally categorized as low-risk, medium-risk, and high-risk. Your company will likely be checked online if you fall into the "medium" and "high-risk" categories.

... The decision to categorize you or your company as 'medium' or 'high risk' is influenced by numerous factors.

Many financial institutions will place corporate clients with foreign directors and/or founders into these specific categories, as well as clients opening accounts remotely. The type of business for which you are opening an account also holds significant importance.

All of this underscores the importance of everyone preparing for an online reputation check! ...

Maryna Makarenko, CEO Antwort Law

In case of unfavorable findings, you risk moving into the high-risk client group, with which not many banks are willing to work, as such companies may pose potential problems, threats, and sanctions. According to established global practice, it can be confidently stated that negative information about you on Google, in the databases of government agencies, and international organizations is more likely to categorize you as a high-risk client.

Using an example from Antwort Law's practice, let's discuss the consequences of failing such a check. Our client, engaged in electronics supply, faced the cancellation of his transaction by the bank due to an article revealing the use of his counterpart's company technology by a dictatorial regime to suppress opposition. The bank decided that accepting payment from such a company would be too risky. And, if you think that bankers directly informed the client of the reason, that's not the case. We conducted several rounds of negotiations with the bank representatives to determine the real reason behind this alarming and unpleasant incident for any entrepreneur. As you can see, besides the reputation of the company and its key employees, it is also important to monitor the image of your counterparts and clients.

So, in increasingly active screening by banks and financial institutions, it is important to take preventive measures to avoid potential reputation problems. To be calm before such a check, follow our recommendations:

  1. Have a corporate website: Almost all banks have already made the presence of their website a mandatory requirement for opening an account. Although there are many companies for which tools generating online customer flow are unnecessary, we are confident that it is a must-have for any foreign company.
  2. Generate content: Write articles on your corporate website about your business, release news about the company and industry events, and participate in professional conferences. Any positive or at least neutral mention of you online will shape your virtual image.
  3. Manage the company's social media accounts: The absence of accounts on social networks, just like a website, can raise bankers' suspicions about the real purpose of the business.
  4. Check the reputation of top management, clients, and counterparts: Manual screening is time-consuming and effort-intensive, with only sometimes reliable results. However, even a superficial initial check on Google can be helpful. There are already automated solutions if you are interested in a more serious analysis.

In conclusion, note that the company's digital footprint can affect not only your banking status but also business relationships. Proactive reputation management online is becoming a key element of successful business operations abroad. Antwort Law is always ready to assist, providing you with up-to-date information, expert support, and recommendations.

Lidia Ivanova,

International Lawyer
Antwort Law

Why does the bank refuse to open an account?
The reasons can be diverse, but the four most common ones are: 1. Errors in document preparation. 2. Incomplete data, brief and unconvincing answers, lack of logic and structure in responses, and the absence of a well-thought-out company history. 3. The nationality of the founders and/or directors. 4. The company's activities or insufficient turnover. For example, it can be challenging for cryptocurrency companies to open an account due to the nature of their business, and many banks evaluate the potential turnover of the company during the selection process.
Do banks check a company's reputation online?
Yes, they do. Banks have implemented screening for companies based on negative mentions in the media and international databases in accordance with global standards for combating money laundering and terrorism financing. It is necessary to monitor not only the online reputation of the company itself but also key individuals within the company and even clients and counterparts to avoid being placed on the bank's "black" list.
What if there is no information about my company on Google or there are negative mentions online?
Negative information about your company on Google and other sources can lead your company to be categorized as a high-risk client for banks. Typically, high-risk clients face difficulties in opening accounts and conducting transactions, up to their cancellation. It is also important to monitor the reputation of your counterparts and clients, as they also influence the profile and image of the company in the eyes of the bank.
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