Why are so many companies reluctant to disclose their ultimate beneficial owners (UBO), and why do we have to continue to request this information?

There are several reasons why companies may be reluctant to reveal their UBOs. These include:

• Companies are concerned about protecting the privacy of their UBOs, especially if they’re natural persons instead of legal entities.
• Companies may have complex ownership structures that are difficult to unravel, and disclosing the UBO might necessitate a lot of effort and resources.
• Companies may be concerned about legal liabilities that could arise if they disclose their UBOs, like potential litigation or regulatory action.
• Companies may be protective of competitive information or trade secrets.

Regardless of these concerns, it’s essential for companies to disclose their UBOs for multiple reasons, including compliance with laws and regulations and the need for transparency in business transactions. Many countries have laws and regulations requiring companies to identify and report on their UBOs as part of their compliance regulations. Failure to do this can result in fines and other penalties. In addition, disclosing UBO information can help build trust and confidence in business relationships and can help prevent financial crimes like money laundering and financing terrorism.

Why shouldn’t I be shy about asking my business partners about their UBOs, and how will this benefit me in the long run?

Asking your business partners about their UBOs is an essential step in due diligence and can help you understand the risks associated with doing business with them. There are several reasons why this can pay off for you in the long run, including:

• Asking your business partners about their UBOs ensures you’re in compliance with relevant laws and regulations requiring you to identify and report on the UBOs of the companies you do business with. You’ll avoid fines and penalties by asking for UBOs.
• Identifying a company’s UBO can help you assess the risk of doing business with it. If the UBO is a politically exposed person or has a criminal record, this may increase the risk of working with the company.
• Asking about a company’s UBO is an essential step in due diligence that can help you understand the ownership structure and any potential conflicts of interest.
• Asking about a company’s UBO can help build trust and confidence in your business relationship because it demonstrates your commitment to transparency and compliance.

Overall, it’s essential to be courageous when it comes to asking your business partners about their UBOs. It can help you manage risks and ensure you comply with relevant laws and regulations.