Hello.

Today I would like to tell you a story from my practice about a Russian food company that wanted to deceive one of my foreign clients. In my new book “Your first 50 Right Steps to Enter the Russian Food Market” I devoted a whole chapter to this topic. I explained in detail why it is necessary to check potential business partners in Russia.

In this post, I will tell you about a real case from my practice, will show you all the documents and will explain you the deception scheme on this example.

Some time ago I received a message on LinkedIn:

“Hi Alex, I was offered to buy lobsters from Russia at $2 per kg. Do you think this is a good offer? With us they cost no less than $4 per kg.”

My reply:

“Hi John (I changed the name on purpose), I can tell you with a 100% guarantee that lobsters are not caught or bred in Russia, so under no circumstances lobsters from Russia can cost less than those from countries where they are harvested or bred.

John’s reply:
“But this is a very serious company. Look, they have even sent us their business a license.”

When I saw this document, I wanted to laugh at first but then I realized that if John hadn’t written to me now, he would have been deceived and lost his money. He wanted to buy several containers of those lobsters from Russia.

The first thing I noticed was the seal of the issuing authority. As you can see in the image, it says “Russian administration”. In Russia there is no such government agency, so this entire document was fake.

Secondly, I immediately saw that the seal of the organization issuing this license was made with gross violations of Russian laws. If you do not know, in Russia a seal can be done only after providing specific documents. Therefore, on Russian seals there is always all basic data of a company: its registration number, tax number and city.

As you can see in the photo, there is nothing like this on this seal. There is only the address of this organization. Of course, I checked this address. In Russia it is not difficult, since all the necessary information can be found freely on the Russian Internet. And as you might have guessed, there was no such company at this address.

I got interesting to check some more facts about this company. As you can see in the image, this company is called Antario Groups, it is located in St. Petersburg, its registered capital is 4 billion rubles and this company was registered on April 12, 2018.

In Russia, there is a lot of official information available on specialized websites. And this information is open for everyone.

And as you see in the photo, Antario Groups company does really exist, and it is really located in the city of St. Petersburg. But its registered capital is not 4 billion rubles, it is only 10,000 rubles. Moreover, this company was not registered on April 12, 2018, it was registered on April 30, 2012.

I even double-checked on another Russian website and also found information that this company was registered on April 30, 2012.

Then, I decided to check how much money this company had and found Antario Groups accounting report for the period from 2012 to 2017.

As you can see in the photo, at the end of 2017, Antario Group company declared 127,415,000 rubles as assets. They indicated in their business license that their registered capital was 4 billion rubles, but after 5 years only 127 million rubles remained on their balance sheet, which is 31 times less than it was at the beginning. As you can see, this company is not doing very well.

Actually, I did not even have to look for all these documents, since the license itself had some gross violations of Russian law. So, it was immediately clear that it was a fake license.

In Russia all official documents must have the following: a date of creation of this document, a serial number, a city where this document was issued, a signature with a name of the person in authority to sign this document. Moreover, if it is a license or some other government document, it must be with a letterhead, holograms and other security elements.

As you can see this company attempted to deceive their potential foreign buyer. It was the easiest scheme in my practice, so I did not even charge my foreign clients for this service of checking their potential supplier.

Of course, Russia is a big country and unfortunately there is crime like in any other country. Therefore, foreign companies need to be especially careful when choosing potential future business partners in Russia not to lose their money.

If your company already works in the Russian market, you should always check your existing business partners. If you see that sales of your products on the Russian market are declining, if you start noticing that buyers pay for goods with a delay, if you see that your “partners” do not comply with the terms of the contact, then you can suspect possible crimes and deceit.

I wrote all this article not only as an expert in food industry, but also as a qualified investigator (since it was my first degree at university). Of course, I have been practicing food for more than 16 years, but I always use the knowledge and experience gained during my training at law institutes.

If you are interested in learning more about the Russian food market, you can read my book “Your first 50 Right Steps to Enter the Russian Food Market”. Information from this book will prevent you from making mistakes and losing money when working in Russia.