TBML009 · TBML

Shell Company Trading

Shell Company Trading routes trade through a counterparty with no genuine commercial substance — no employees, premises, trading history or economic footprint — used to give illicit trade a legitimate commercial face. The shell exists to transact: to hold accounts, sign contracts and settle payments while the real party stays hidden behind it.

It is used to:

• Give illicit trade a legitimate-looking counterparty
• Layer funds through a substanceless entity
• Conceal the true party behind the trade
• Support related-party value transfer
• Facilitate sanctions evasion behind a clean-screening name

Risk narrative

A customer trades with a counterparty that has no real economic footprint — a low commercial- footprint score and a shell indicator. The trade documents describe an ordinary commercial relationship, but the counterparty has no employees, premises or trading history to support it. Where the parties share ownership and the corridor is high-risk, the shell is a conduit for value transfer rather than a genuine trading partner.

Risk indicators

Risk

• Shell Counterparty
• No Commercial Footprint
• Related Party Trading
• High Value Trade
• High Risk Corridor
• Recently Incorporated

Investigation actions

1. Assess the counterparty's commercial substance — employees, premises, trading history.
2. Resolve the counterparty's ownership and ultimate beneficial owner.
3. Test for a legitimate business rationale for the trade.
4. Test for shared directors / owners and related-party trade.
5. Package evidence for investigator review where the score is High or above.

Use cases

• Trade Based Money Laundering (TBML)
• Shell Company Abuse
• Related Party Value Transfer
• Layering
• Sanctions Evasion

Related typologies

Curated from fc-04-tbml-analytics-toolkit/typologies/TBML009/TBML009_Shell_Company_Trading.md