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What is an Ultimate Beneficial Owner or UBO?

An ultimate beneficial owner is a person or a company/entity that becomes the ultimate beneficiary when any transaction takes place. Following are the criteria of someone being the ultimate beneficial owner:

  1. The person holds interest of at minimum 25 percent of capital of the legal entity
  2. The person has at minimum 25 percent voting rights within a company.

The UBO legislation has been created in the UAE to counter:

  1. Fraud
  2. Money Laundering
  3. Terrorist financing.

By implementing the UBO legislation, the goal is to find out the ultimate beneficiary of any business transactions. Even though there are two criteria given that can easily inform someone about the UBO, things get tricky when it’s the shell companies we are dealing with. In such cases, seasoned professionals have to be involved in order to find out the primary beneficiary.

But why should you look for such services?

Ultimate Beneficial Owner

Benefits of knowing the UBO

A business transaction should only happen between entities that are transparent to each other. It reduces the cases of fraud and the business transaction goes smoothly. What if even though the transaction is smooth, you’re not transparent with each other? What if, there is someone in background holding all the cards of your business; someone who has been manipulating the business strings for their own selfish gain.

For banks, it’s an important factor to consider. There have been many cases that fraudulent individuals have received money on the basis of fake identities. Tackling those individuals is important. And it can only be done if someone knows how to single out the UBO.

The benefits of singling out the UBO are as follows:

  1. Find out who you do business with
  2. Get access to cleaner transaction records
  3. Know the exact detail behind the transaction
  4. Enforce transparency in your business transaction.

How does KRV Auditing singles out the UBO

The consultants of UBO implements the following procedures to find out about the UBO:

  1. They first acquire the firm’s information present at the surface level.
  2. They then dig deep to get the understanding of the ownership chain.
  3. Finally, the find out the Ultimate Beneficiary
  4. Finally, they run the KYC of the beneficiary to see whether they are legible individuals or not.

Knowing who you do business with is important. Thus, when you’re in doubt about any business that you want to partner up with, reach out to us. We will portray the true picture of the Ultimate beneficiary before you.

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