Martín Gil Strategy & IntelligenceMARTÍN GIL STRATEGY & INTELLIGENCE
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Priority area

Counterparty verification and risk

Reduce exposure before contract, payment or dependency removes options.

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Problems covered

Identity and control

Confirm who the counterparty is, who controls it and who may bind it.

Capability and compliance

Test ability to perform and legal, regulatory or reputational exposure.

Payment and protection

Limit advance payments, dependency, jurisdiction and recovery risk.

Decision path

From the question to conditional action

Diagnose

Define evidence, exposure and gaps.

Prioritise

Sequence the highest-impact risks and decisions.

Decide and execute

Set conditions, owners, milestones and review.

Operational definition

Counterparty verification connects identity, authority and capacity to the specific transaction

Counterparty verification is an independent review of the person or entity with which you may contract, pay, invest or share sensitive information. It is not a document-collection exercise: it establishes who exists, who controls the entity, who may bind it and which capabilities can be evidenced.

Scope follows exposure. A limited relationship may require basic corporate checks; an international transaction, advance payment or intermediary chain may require enhanced due diligence, OSINT sources and direct confirmations.

Verification perimeter

Six layers that must form one coherent account

01

Corporate existence and identity

Registry, address, activity, age, status and consistency between the declared entity and the contracting party.

02

Ownership and beneficial owner

Shareholders, direct and indirect control, UBO, related entities and opacity that prevents accountability.

03

Authority and representation

Directors, signatories, powers, mandate, scope of representation and independent confirmation with the principal.

04

Capacity and actual supplier

Resources, licences, experience, facilities, supply chain and evidence that the promised performance is feasible.

05

Documentary chain

Dates, issuers, title holders, references, versions and consistency across offer, contract, logistics, inspection and payment.

06

Sanctions, compliance and payment

Jurisdictional exposure, applicable lists, PEP where relevant, source of funds, payment conditions and recovery options.

Risk-based escalation

Red flags determine when the review must go deeper

  • The principal or beneficial owner cannot be established.
  • The alleged representative controls every communication and prevents direct contact.
  • Claimed capacity conflicts with records, facilities, history or documents.
  • Intermediaries, jurisdictions, sanctions exposure or payment flows remain unexplained.
  • Artificial urgency demands funds or sensitive documents before verification is complete.

Findings are classified as confirmed facts, claims, inferences, contradictions and pending items. The resulting decision may be to proceed, condition, renegotiate or stop.

Applied evidence

Sanitised public cases and tools connected to the process

The sanitised due diligence cases show how corporate, documentary and operational chains are tested without disclosing confidential information. A preliminary review can be structured with the counterparty risk matrix and, for supply relationships, the strategic supplier assessment.

For hydrocarbon transactions, review extends to terminal, storage, title, inspection and procedure; see the EN590 10 ppm due diligence service.

Decision questions

Counterparty verification FAQ

What is counterparty verification?

It is an independent review of identity, ownership, authority, capacity, documents and exposure before contracting, paying or investing.

Which documents are reviewed in counterparty due diligence?

Depending on scope: corporate records, ownership structure, powers and mandates, licences, financial statements, contracts, operating evidence and transaction documents. Their existence does not replace independent confirmation.

How is signatory or mandate authority verified?

The signatory or mandate is connected to the entity and principal through registries, corporate bodies, current powers and confirmation through independent channels.

When is enhanced due diligence required?

When ownership is opaque, sanctions exposure exists, intermediation is unexplained, urgency is artificial, advance payments are requested, documents conflict or capacity and authority cannot be confirmed.

Does verification guarantee that the counterparty is safe?

No. It separates facts, claims, inferences and gaps to support a conditional decision; it cannot guarantee solvency, future conduct or performance.

What is the difference between KYC, KYB and counterparty verification?

KYC identifies and tests an individual; KYB verifies a company’s existence, structure, activity and control. Counterparty verification combines both where relevant and adds authority, capacity, documents, exposure and transaction logic. The counterparty risk matrix helps structure the analysis without replacing registries or independent confirmation.

How is the UBO or ultimate beneficial owner verified?

The ownership and control chain is reconstructed to the relevant natural persons by testing registries, constitutional documents, shareholders, directors and control arrangements. Counterparty declarations are a starting point; the FATF guidance on beneficial ownership sets the benchmark that competent authorities should have timely access to adequate, accurate and up-to-date information.

What evidential value does a CIS or Company Information Sheet have?

A CIS organises declared data — entity, address, registry, directors, UBO, signatory, contacts and bank — but does not by itself establish identity, ownership, authority, capacity or funds. It must be compared with registries, domains, independent communications, powers and transaction documents.

Are due diligence and compliance always legally required?

There is no identical universal obligation for every transaction. Requirements depend on jurisdiction, sector, regulated status, applicable sanctions and risk. Even where no specific rule imposes the same procedure, a proportionate review may be needed for a diligent decision; the European Commission recommends risk-based sanctions controls, not a single model.

How should sanctions, alerts and blacklists be handled?

First distinguish a current official list from an internal alert, media report or unverified allegation. Resolve matches using identifiers, UBO, ownership or control, jurisdiction and date. A non-official warning is a trigger to investigate, not evidence for publishing an accusation; consult the European Union’s official sanctions resources and document the decision.

EN590 transactions

Verify terminal, tank, title and TTT feasibility before exposing funds.

A dedicated route covers EN590 10 ppm transactions in Rotterdam and Houston, combining documentary, operational and counterparty verification.

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