INTERPOL and the Necessity of Early Risk Assessment for International Businesses

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Once upon a time, a business with interests abroad had little reason to consider INTERPOL in its evaluation of whether to accept international business opportunities.  That time is no longer.

As INTERPOL grows and its member countries have increasing contact with one another both politically and economically, so grows the need for private businesses to conduct previously unheard-of analyses of costs and benefits.  INTERPOL receives requests for Red Notices not only for people accused of violent crimes, terrorism, and human trafficking, but also for people alleged to have been involved in business gone bad.

For those accustomed to a more Western approach to business issues, there is a frequently held assumption that an unsuccessful business transaction or plan will result in nothing more than lost future oppportuniities or, at the worst, a civil law suit.  In many other countries, however, the loss of money by one party can quickly become a criminal matter for the other party. When this transformation of a civil matter into a criminal matter takes place in an INTERPOL member country, the member country may request a Red Notice after criminal charges are filed.

How does this play out?  Even if the accused party is innocent, and even if that party has always conducted business activity from outside the member country, once criminal charges are filed, the accused party becomes the subject of a Red Notice.  Whether the Red Notice was properly requested or not, the now-subject of the Red Notice is left to either challenge the propriety of the Red Notice or live with the fact that she can no longer travel for business or pleasure and is subject to being detained.

Just like grandmother used to say, an ounce of prevention is worth a pound of cure.  A business considering international contracts or endeavors would be well-served to research the country of concern prior to engaging in that activity.  Questions to be answered in advance by a company or its attorney should be:

  • How does the country treat debtors?
  • Does the country have a history of jailing people for primarily civil matters?
  • How does the country's judicial system regard failed business transactions?
  • Does the country have a high level of corruption?

Obviously, if these inquiries are not made by the interested company, the individual charged with conducting the international activities will need to research those issues prior to becoming involved.  Only once the answers to these questions are known should a new business concern with an INTERPOL member country begin.

As always, thoughts and comments are welcomed.