Guide: how to avoid fines and losses when choosing customers and suppliers

Three ways the wrong counterparty costs you money

The damage usually comes from one of three directions. Each can be checked in advance, and each can change after you sign.

Sanctions: the fines set by law

Sanctions forbid or restrict dealings with listed people and companies. Breaking them is an offence in most jurisdictions. The table shows the maximum amounts in force on 29 October 2026, taken from the official texts of each authority.

These are maximums: the actual penalty depends on the case. In the United States a civil penalty is counted per violation, so a series of payments to the same party can mean several violations. US amounts are usually adjusted each January.

Beyond the fine, a breach can mean frozen funds, payments stopped by your bank, goods held at the border and a public enforcement notice with your company's name.

Why not knowing is not a defence

Strict liability in the United States

US civil sanctions penalties apply on a strict liability basis: a company can be fined even if it did not know it was dealing with a sanctioned party. Knowledge and intent affect the size of the penalty, not whether a violation happened. Foreign companies can also be involved, for example when a payment is made in US dollars or goods of US origin are part of the deal.

In the United Kingdom, since 2022, OFSI can impose civil penalties without having to prove that a company knew or suspected the breach. Records matter too: in the United States, records of transactions subject to sanctions rules must be kept for 10 years.

Indirect ownership: the 50% rule

A company that is not on any list can still be blocked. In the United States, an entity owned 50% or more, directly or indirectly, by one or more blocked persons, individually or together, is treated as blocked even if its name appears on no list. The European Union and the United Kingdom apply similar tests based on ownership of more than 50% or on control.

This is why checking the name on the contract is not enough: the owners and the people who control the company need to be checked too. How these rules apply to your case is a question for your legal advisers; first, the information has to be collected.

Financial difficulty: what an insolvent counterparty costs

A counterparty in financial difficulty rarely announces it. The signals appear in public sources first: late filings, overdue annual accounts, changes of registered office, news on payment delays, notices of insolvency proceedings.

When the customer cannot pay

Invoices issued before the insolvency usually become claims in the proceedings, alongside those of the other creditors. Recovery can take years and return only part of the amount, while you have already paid for the materials and the work.

When the supplier fails

If a key supplier stops, your production can stop with it. Advance payments and deposits can be lost or become ordinary claims. Replacing a supplier under pressure takes time and usually costs more, and late deliveries can trigger penalties in your contracts with customers.

When payments you received are challenged

In many countries an insolvency administrator can challenge payments made in a period before the insolvency and ask the recipients to return them; rules and periods vary by country. A customer that paid you while already in difficulty can cost you twice: the open invoices and the payments you thought were closed.

A company can be solid when you sign and struggle a year later, which is why these signals need to be followed over time, not checked once.

Lawsuits, fraud and fines from authorities

A counterparty can be solvent and not sanctioned and still be a risk. Court cases, fraud investigations and penalties from competition, data protection or supervisory authorities say a lot about how a company works.

• Direct losses. A supplier involved in fraud can deliver non-compliant goods, issue false documents or disappear with your advance.
• Liability toward your customers. If what you sell depends on a supplier's product or data processing, a problem at the supplier can become a claim against you.
• Reputation. Your name can appear next to theirs in the news, even when you did nothing wrong.
• Tenders and banks. Public buyers can exclude bidders, and sometimes their subcontractors, for certain offences; banks and investors ask how you select your counterparties during loan reviews, due diligence and fundraising.

Large customers increasingly ask, in supplier questionnaires, how you check your own suppliers. A documented process, with source and date for each check, is the simplest answer.

How to avoid these risks: four checks

Most of these signals are public. The work is to look for them every time, in many sources, and to keep looking after you sign. Unicorn Intelligence does this with four tools.

1. An instant check of a name

Before a meeting, an offer or a first payment, check a person or a company against sanctions lists in seconds. Each instant check costs $5, with no daily limit, and the result is saved in your reports with a PDF.

2. Your customers and suppliers, checked every day

Upload your customers and suppliers once, from a file, a pasted list or the API. Every day they are compared with the current lists, and you get an alert only when something new appears, with the reason and the measure it implies. With pay as you go each name costs $25 per month.

3. A full report before you sign

Before a large contract, a new distributor or a significant advance payment, order a full report on the company: official registers, sanctions on the company and on the names found, court cases, proceedings by authorities, financial strength and signs of insolvency, news. It ends with an overall assessment from A (no significant findings) to E (relationship prohibited or not advisable). You choose the right company from a list before paying, and if no data is found you are not charged. The price is shown before you confirm: $690 with pay as you go, or included in the plans with reports.

4. Monitoring of the rules that apply to you

Regulatory monitoring follows official journals and authorities in the countries you choose and sends you summaries in your language, at $900 per country or area per month with pay as you go.

Not sure where you stand? The free sanctions risk test gives you a score in a few minutes, without signing in.

Checklist: onboarding a new customer or supplier

1. Collect the full legal name, country, registration number or LEI, and website.
2. Run an instant check on the company and on the people you deal with.
3. Identify the owners and the people who control the company and check them too, keeping the 50% rule in mind.
4. For significant contracts or advance payments, order a full report and read the assessment, court cases and financial strength.
5. Verify every potential match on the official source before deciding, and record the decision with a note.
6. Add the counterparty to your daily monitoring list, so changes reach you automatically.
7. Keep the evidence (report PDF, date, sources and decision) for as long as the law requires: 10 years for US sanctions records.

Checklist: the annual review

• Align your monitoring list with your accounting system: new customers and suppliers in, closed relationships out.
• Update the ownership of your main counterparties: shareholders change.
• Order a new full report on your largest customers and your most critical suppliers.
• Review the matches and alerts of the year and check that each one has a decision and a note.
• Export the audit log and keep it with your compliance records.
• Check that your monitoring profiles still cover the countries and rules where you work.

What it costs compared with a single fine

A fine is only the visible part: legal costs, blocked payments, a lost supplier or an unpaid invoice come on top of it.

In short: $5 per check, $25 per month to keep a name under watch every day, $690 for a full report, and the first $50 are on us, no card required. Then continue pay as you go or choose a subscription. The current prices are on the pricing page.

What the service does not do

Unicorn Intelligence is an information tool. It finds, organizes and documents information from official and open sources; it does not decide for you, it does not replace legal advice and it does not make your company compliant.

Coverage is never complete. The absence of results does not prove that a company has no proceedings, debts or problems: it means that nothing was found in the sources consulted on that date. Always verify a potential match on the official source before acting. Decisions and legal obligations remain with your company.

Frequently asked questions

Can my company be fined if it did not know a counterparty was sanctioned?

In the United States, yes: civil sanctions penalties apply on a strict liability basis, and knowledge affects the amount, not whether a violation occurred. In the United Kingdom OFSI can impose civil penalties without proving knowledge. Ask your legal advisers how the rules apply to you.

What is the 50% rule?

In the United States, a company owned 50% or more, directly or indirectly, by one or more blocked persons is treated as blocked even if it is not on a list. The European Union and the United Kingdom use similar tests based on ownership of more than 50% or on control.

How do I know if a supplier is close to insolvency?

Look for public signals: insolvency notices, register status, overdue accounts, late filings, frequent changes of registered office and news on payment delays. The full report collects them in its financial strength section and in the assessment from A to E.

How often should customers and suppliers be checked?

At onboarding and then every day for sanctions, because lists can change on any working day, with a full report before significant contracts and a review once a year. Unicorn Intelligence runs the daily check and alerts you only when something new appears.

What does it cost to start?

$5 per check, $25 per month to keep a name under watch every day, $690 for a full report, and the first $50 are on us: new company accounts start with $50 of free usage, no card required. Then you continue pay as you go or choose a subscription.

If the report finds nothing, is the company safe?

Not necessarily. No result means that nothing was found in the sources consulted on that date, and coverage is never complete. The report is an information tool: decisions and legal obligations remain with your company.