Counterparty risk and compliance
Before you trade with a party, you onboard it: KYC, beneficial owners, sanctions and PEP screening, and a risk rating. A credit assessment scores its finances and recommends a credit limit. A daily sweep looks for double financing, duplicate invoices, circular trades, price outliers, sanctions hits and expiring credits. Every change to a trade record is written to a tamper-evident audit trail.
1. Counterparty profiles
Risk & Treasury › Risk › Counterparty Profile (/palbon-trade-finance/counterparties).
- New. Name, Role (Supplier, Buyer, Bank, Surveyor, Shipowner, Funder, Other), Linked Record Type and Linked Record (the Supplier, Customer or Bank), Country, Registry (Companies House, SEC EDGAR, MCA / Udyam, ACRA, Other) and Registry ID.
- KYC and Risk: KYC (Not Started, In Progress, Verified, Rejected, Expired), Risk Rating (Low, Medium, High, Prohibited), Risk Score, ESG Score (0-100; used for green-finance eligibility), Sanctions and PEP (set by screening), Last Screened.
- Credit: Currency and Credit Limit (set by an approved credit assessment).
- Ultimate Beneficial Owners: one row per owner: Owner, Nationality, Ownership %, Politically Exposed, Sanctions, Held Through (for example via Harbour Holdings BVI). Owners may not add up to more than 100%.
A company is no cleaner than its owners: the worst owner screening result becomes the company's, and a politically exposed owner marks the company PEP.
1.1 Onboarding workflow
| Step | Action | Who |
|---|---|---|
| New | Start KYC | Trader, Trade Risk Manager |
| KYC In Progress | Send to Screening | Trader, Trade Risk Manager |
| Screening | Screening Clear (sanctions Clear or Potential Match) | Trade Risk Manager |
| Screening | Block (Sanctions Match) (Confirmed Match) | Trade Risk Manager |
| Pending Risk Approval | Approve (Low or Medium risk) / Approve High Risk (High), not the requester | Trade Risk Manager |
| Pending Risk Approval | Reject | Trade Risk Manager |
| Approved | Re-screen (owner change, annual review) | Trade Risk Manager, Trader |
A party under a confirmed sanctions match, or rejected at KYC, cannot be the beneficiary or applicant of a credit that is approved or issued (the credit's risk gate).
2. Sanctions lists
Master Data › Lists › Sanctions List Entry: List (OFAC SDN, OFAC Consolidated, EU Consolidated, UN Security Council, UK HMT, India MHA, Internal Watchlist, PEP Register), Name, Type (Entity, Individual, Vessel, Aircraft), Also Known As, Country, Programme, List Entry ID, IMO (vessels), Listed On, Politically Exposed Person. Load the lists you are required to screen against and keep them current; automatic list downloads are not part of this release.
3. Name matching
Names are compared without legal forms (Pte Ltd, LLC, GmbH, PT…), accents and punctuation, and in any word order, giving a similarity from 0 to 100. A vessel also matches on its IMO number.
4. Sanctions screening
Risk & Treasury › Risk › Sanctions Screening.
- New. Title (for example Onboarding screen: Bosphorus Refineries AS), Screen (Counterparty Profile or Vessel), Subject, Include Beneficial Owners, Match Threshold (for example 85%).
- Actions › Run the screening: every name (and the owners, and a vessel's IMO) is compared with every list entry. Screened On, Names Screened, List Entries Checked and Result (Clear, Potential Match, Confirmed Match) are filled, and each match is listed with its score.
- The subject's profile takes the latest result (and PEP status when a PEP register entry matched).
| Step | Action | Who |
|---|---|---|
| Screened | Clear (result Clear) | Trade Risk Manager |
| Screened | Review Possible Match (result Potential Match) | Trade Risk Manager |
| Under Review | Clear as False Positive / Confirm Match (not the requester) | Trade Risk Manager |
Write the reasoning in Review Note. By voice: Screen Northwind Resources.
5. Credit assessment
Risk & Treasury › Risk › Credit Assessment.
- New. Title, Counterparty (its profile), Assessed On, Valid Until, Currency, Limit Requested.
- Financials (latest year): Revenue, EBITDA, Net Worth, Total Debt, Current Ratio, Years Trading.
- Behaviour and Country: Paid on Time (last 12 months) %, Trades Completed with Us, Country Risk, Bureau Score (if you have one).
- Save. The app scores it:
| Factor | Weight | From |
|---|---|---|
| Leverage | 20 | Total debt ÷ EBITDA |
| Liquidity | 15 | Current ratio (2.0 or better scores full) |
| Size | 15 | Net worth (50 million or more scores full) |
| Payment record | 20 (30 without a bureau score) | Paid on time % |
| Track record | 10 | Years trading and trades with you |
| Country | 10 | Country risk |
| Bureau | 10 | Bureau score, when given |
Internal Score (0-100), Rating (AAA to C) and Recommended Limit (the smaller of 10% of net worth and 5% of revenue, scaled by the rating) are shown. Enter the Approved Limit.
| Step | Action | Who |
|---|---|---|
| Draft | Submit for Approval | Trader, Trade Risk Manager |
| Pending Approval | Approve (not the requester) / Reject | Trade Risk Manager |
| Approved | Mark Expired | Trade Risk Manager |
An approved assessment sets the profile's Credit Limit and Risk Score.
6. Trade alerts and the fraud sweep
Risk & Treasury › Risk › Trade Alert. Every day the app sweeps the books and raises one alert per finding (a second sweep updates the same alert; it never closes one by itself):
| Alert | Finds |
|---|---|
| Double Financing | One bill of lading backing more than one live funding request |
| Duplicate Invoice | The same invoice number from the same counterparty on two settlements |
| Circular Trade | Goods sold back to where they came from |
| Price Outlier | A purchase price more than 25% from the median of the same commodity |
| Sanctions Hit | A profile with a potential or confirmed match |
| Deadline | A live credit expiring within 7 days |
| Rejection Limit | A settlement frozen by the rejection limit (raised at once, not by the sweep) |
Each alert has Severity (Info, Warning, Critical), the record it is about, What Was Found and Resolution.
| Step | Action | Who |
|---|---|---|
| Open | Acknowledge | Trade Risk Manager, Trade Finance Manager, Trader |
| Acknowledged | Close (write the resolution) | Trade Risk Manager |
| Open | Close as Not Relevant | Trade Risk Manager |
7. Audit trail
Every created, changed or deleted trade record writes an entry to Administration › Audit › Trade Audit Entry. Each entry holds a hash of the previous one, so removing or editing an entry breaks the chain from that point. Field-level changes are also in each record's version history.
To verify the chain, a Trade Auditor or System Manager opens, while signed in:
/api/method/palbon_trade.trade_risk.audit_trail.verify_chain
It answers {"ok": true, "entries": <n>} or tells where the chain breaks.
Administration › Audit › AI Action Log keeps every assistant command: who, what was said, what was understood, and what was done.
8. What is not in this release
Registry look-ups (Companies House, SEC, Udyam), bank-account verification, credit-bureau connections, automatic re-screening when lists change, and a graph view of ownership are not available yet; record their results by hand.