Commodity Transaction Risk Checklist
This is the 50-point checklist our analysts run through on every engagement. It covers the most common risk indicators across entity, documentation, custody, operations, and compliance. It is not exhaustive — every transaction has its own risk profile — but it catches the patterns we see most frequently.
Entity risk indicators (Points 1–10)
These indicators relate to the supplier's legal existence, ownership, and registration status.
- 1. Supplier not found in the official company registry
- 2. Registration status is suspended, deregistered, or inactive
- 3. Registered address is a virtual office or does not exist physically
- 4. Company name is close to but not identical to a known legitimate entity
- 5. Directors or ownership differ from what the supplier disclosed
- 6. Beneficial ownership is obscured or links to sanctioned individuals
- 7. Entity is recently registered with no trading history
- 8. Entity is registered in a different country than claimed
- 9. Multiple entities using the same registered address
- 10. Entity has no online footprint or has adverse media
Documentation risk indicators (Points 11–20)
These indicators relate to the authenticity and consistency of trade documents.
- 11. Export permit does not appear in the issuing authority's records
- 12. Export permit format does not match the authority's current template
- 13. Export permit is expired or expires before the proposed shipment
- 14. Export permit is issued to a different entity than the supplier
- 15. Certificate of origin format does not match the issuing authority
- 16. Assay certificate details do not match the claimed material
- 17. Assay purity claim is implausibly high for the origin
- 18. Weights or quantities differ across documents in the set
- 19. Dates are inconsistent or impossible across the document set
- 20. Signatures, stamps, or letterhead differ across documents from the same issuer
Chain-of-custody risk indicators (Points 21–30)
These indicators relate to the supplier's ability to account for the commodity's journey from source.
- 21. Supplier cannot specify where the commodity was mined or sourced
- 22. No documents supporting transfers between custody points
- 23. Custody path is inconsistent with transport documents
- 24. Consolidation with unnamed or cross-border sources
- 25. Supplier acquired material "recently" but cannot say from whom
- 26. Timeline gaps that the supplier cannot explain
- 27. Vague sourcing language ("trusted partners", "various sources")
- 28. No warehouse or storage records available
- 29. Transport route is inconsistent with the origin and destination
- 30. Bill of lading cannot be verified with the named carrier
Operational risk indicators (Points 31–40)
These indicators relate to the supplier's physical operations and capacity.
- 31. Supplier refuses or avoids a site visit
- 32. Site visit reveals a staged or showroom operation
- 33. No visible staff, equipment, or infrastructure at the claimed site
- 34. Storage conditions are inconsistent with the commodity claimed
- 35. Supplier cannot demonstrate operational capacity for the volume offered
- 36. No evidence of prior successful exports
- 37. Supplier pressures for rapid payment before verification
- 38. Payment requested through a personal account or unrelated third party
- 39. Stock photos or recycled images presented as current inventory
- 40. Supplier cannot meet in person at their claimed operating site
Compliance and commercial risk indicators (Points 41–50)
These indicators relate to regulatory, sanctions, and commercial structure risks.
- 41. Supplier or beneficial owners appear on sanctions lists
- 42. Supplier or owners are PEPs without disclosure
- 43. Transaction structure is inconsistent with the country's regulatory framework
- 44. Origin claimed is inconsistent with the custody path or transport documents
- 45. Price is significantly below market — a common fraud lure
- 46. Supplier offers unusually large volumes from a country with limited production
- 47. Transaction involves a conflict-affected or high-risk area without OECD-aligned due diligence
- 48. No responsible sourcing or ESG documentation available
- 49. Supplier is unwilling to use a letter of credit or escrow
- 50. Any red flag is dismissed by the supplier as "confidential" or "unnecessary"
This 50-point checklist catches the risk patterns we see most frequently. No single indicator is conclusive, but multiple indicators together should stop the transaction until independent verification is complete.