MAALAT · PROBLEM BRIEF #02

The Distributor Integrity Playbook

How mid-market operators verify who they are really dealing with

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Published by MAALAT Research Systems · July 2026 · maalat.co

1. The recurring problem

A mid-market operator wins a new export market. A distributor introduces
itself. The company profile looks credible. The website is real. The
office address exists on the map. A trade licence is emailed as a PDF.
References are named. An agreement is signed. Payments begin flowing.

Then something goes wrong. Not always fraud in the loud, criminal sense.
More often, quiet failure: the distributor is registered but has no
staff. The bank account is in a third country under a slightly different
name. The claimed customer references, when called, have never heard of
the firm. The exclusivity clause suddenly matters when a real order
arrives and the distributor cannot fulfil it. Or, in the worst pattern,
the distributor is a legitimate front for a sanctioned trade route, and
the operator learns this from an enforcement notice, not from a
diligence report.

This brief is not about front-page fraud. It is about the failure mode
mid-market firms actually face: the distributor that is not what it says
it is, verified too late, at the cost of a contract, a customer, or a
regulator conversation.

THE MARKET COST IS DOCUMENTED

Invoice-redirection scams, one narrow subset of the broader
distributor-integrity problem, cost Australian businesses over $132
million in a single reporting period, according to [[ACCC data cited by
Hicksons
Lawyers]{.underline}](https://www.hicksons.com.au/insight-news/august-2021/did-you-really-pay-who-is-liable-for-payment-in-a).
That number is one country, one scam type, one year.

U.S. sanctions enforcement against companies that failed to verify the
true nature of their commercial counterparties totalled [[$265.7
million across 14 published actions in
2025]{.underline}](https://ofac.treasury.gov/civil-penalties-and-enforcement-information/2025-enforcement-information),
per the U.S. Treasury's official enforcement register as of the most
recent update. In 2024, the figure was [[$48.8 million across 12
published
actions]{.underline}](https://ofac.treasury.gov/civil-penalties-and-enforcement-information/2024-enforcement-information).
Every one of these actions started with a counterparty who was not who
they appeared to be.

Roughly three-quarters of Foreign Corrupt Practices Act corporate
settlements ultimately trace back to third-party intermediaries, agents,
and distributors, per [[Miller & Chevalier's FCPA Winter
Review]{.underline}](https://www.millerchevalier.com/publication/fcpa-winter-review-2022).
Distributors and other third-party intermediaries are among the most
common sources of commercial compliance failures. Their role across
sanctions, corruption, and fraud enforcement actions makes them a
recurring point of commercial risk.

Mid-market firms are not immune. They are the most exposed. Global firms
have compliance teams, external due-diligence budgets, and named
liability officers. Mid-market operators have a founder, an operations
lead, and Google.

This playbook exists to close that gap.

2. What "integrity" means in this brief

Integrity, in the MAALAT sense, is not a moral judgement. It is a
verifiable, documentary property of a distributor. A distributor has
integrity when the entity you contract with, the office you visit, the
licence you receive, the bank account you pay, the owners who benefit,
and the references who vouch for it are all consistent and all real.

A distributor fails integrity when any of those elements diverge --- not
through malice necessarily, but through structural gaps that mean you
cannot verify who is on the other side of the contract.

MAALAT frames every finding in this playbook and in the paid Distributor
Integrity Review that follows it as verification outcome, not fraud
declaration. A dimension either verifies, partially verifies, or does
not verify. The playbook produces documented evidence of what can and
cannot be confirmed, then translates that evidence into a recommendation
the operator can act on.

THE THREE-PART WORKING DEFINITION

• The distributor exists in the way it claims to exist (legal,
  commercial, banking).

• The distributor operates in the way it claims to operate (staff,
  premises, references, contract behaviour).

• The distributor pays and gets paid in the way it claims to pay
  (banking name-match, transaction patterns, no third-party
  redirection).

When any of those three break, integrity is compromised. The playbook
below is the mechanism for detecting the break before it costs money.

3. The method, in one page

The MAALAT Distributor Integrity Score is a rubric with eight
dimensions, each scored 0--10 against defined evidence. Each dimension
carries a confidence tag (High, Medium, Low) reflecting how well the
score is supported. The weighted average produces a composite on a
0.0--10.0 scale, which maps to one of five bands (A--E) with a matching
recommendation word. Two override triggers can cap the band regardless
of composite.

The eight dimensions and their fixed weightings:

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# DIMENSION WEIGHT CORE QUESTION
-------- ------------------ ------------ --------------------------------------
1 Legal 15%** Is the entity registered, licensed,
Existence** and in good standing where it claims
to be?

2 Ownership 15%** Can we trace the real beneficial
Transparency** owners without hitting a shell wall?

3 Commercial 18%** Does the entity have real premises,
Substance** real staff, real inventory or
capacity, real customers?

4 Banking 12%** Does the payment account name and
Consistency** jurisdiction match the legal entity,
with no third-party redirection?

5 Market 10%** Do suppliers, customers, and trade
Legitimacy** bodies independently confirm the
entity's market presence?

6 Digital 5%** Does the digital presence (domain,
Footprint** email, no impersonation) match a real
firm of this size?

7 Contract 15%** Will the entity sign, document, and
Behaviour** honour normal diligence windows
without urgency pressure?

8 Transaction 10%** Do payment paths, commissions, and
Anomalies** settlement patterns match sector
norms?
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The five bands are A (8.5--10.0, Verified), B (7.0--8.4, Consistent), C
(5.5--6.9, Watch), D (4.0--5.4, Caution), and E (below 4.0, Avoid). Each
maps to a recommendation word from PROCEED to AVOID.

Two override triggers can cap the band at D regardless of the weighted
composite:

• Trigger A --- a named Critical Failure (seven documentary failures,
  listed in Section 6).

• Trigger B --- a score of 3 or lower on Banking Consistency or
  Transaction Anomalies specifically.

The full rubric with anchor scales, presentation rules, override logic,
and the Coverage % metric lives in the companion document (Rubric v1.1,
MAALAT internal reference). The remainder of this playbook shows how to
apply the rubric in practice.

4. How to verify each dimension

This section is the working part of the playbook. Each dimension is
broken into: what evidence to gather, where to find it, and what the
common failure signature looks like when the dimension breaks.

4.1 Legal Existence (15%)

WHAT TO VERIFY

• Company is registered in the jurisdiction the distributor claims as
  home.

• Registration is current, not lapsed, not dissolved, not struck off.

• Required trade licences or sector-specific permits are current and
  match the entity name.

• The entity has no filings inconsistent with an operating company (e.g.
  dormant filings, extended overdue accounts).

WHERE TO FIND IT

• Home-country business registry. Examples: [[Companies House
  (UK)]{.underline}](https://www.gov.uk/get-information-about-a-company),
  [[SEC EDGAR
  (US)]{.underline}](https://www.sec.gov/edgar/searchedgar/companysearch),
  [[EU Business Register
  (multi-country)]{.underline}](https://e-justice.europa.eu/106/EN/business_registers_in_member_states),
  [Turkey MERSIS]{.underline}, UAE DED
  / free zone registries by emirate, Saudi MoC commercial register.

• Cross-jurisdictional aggregators.
  [OpenCorporates]{.underline} covers
  200+ jurisdictions; useful as a first-pass indicator, not
  authoritative on its own.

• Sector regulator. Financial services, healthcare, energy,
  telecommunications, and defence-related distributors sit under
  specialist regulators whose registers are separate from the general
  company registry.

FAILURE SIGNATURE

The entity is registered but in a different jurisdiction than claimed.
Or registered but dormant. Or licensed under a name that differs from
the trading name by more than a comma. Or the licence is a
plausible-looking PDF that does not resolve to a real record when
checked against the regulator's live database.

4.2 Ownership Transparency (15%)

WHAT TO VERIFY

• Identify the ultimate beneficial owners (individuals who own or
  control the entity).

• Map any parent, subsidiary, or affiliated companies in the same
  ownership network.

• Check for undisclosed common ownership with a competitor of the
  client, a sanctioned party, or a politically exposed person.

WHERE TO FIND IT

• Public beneficial-ownership registers where they exist. [[The UK PSC
  register]{.underline}](https://www.gov.uk/guidance/people-with-significant-control-pscs)
  and the EU's national UBO registers (post-AMLD5) are searchable. In
  Turkey, the Gulf, and much of MENA, UBO is not publicly searchable and
  requires document requests.

• Corporate structure charts, when available. Firms like
  [Sayari]{.underline} and [[Moody's
  Orbis]{.underline}](https://www.moodys.com/web/en/us/capabilities/company-reference-data/orbis.html)
  aggregate ownership graphs; both are subscription products.

• Sanctions and PEP screening against the identified owners and any
  linked entities.

FAILURE SIGNATURE

The company is owned by another company, owned by another company, owned
by a nominee in a jurisdiction with no UBO disclosure. Or the disclosed
UBO is a name that does not appear in any other record anywhere. Or the
ownership map, when reconstructed, reveals a link to a client competitor
or a sanctioned person the distributor did not disclose.

The U.S. Treasury's [[Family International Realty case (settlement,
January
2025)]{.underline}](https://ofac.treasury.gov/recent-actions/enforcement-actions)
shows the pattern at its extreme: a Miami real-estate firm and its U.S.
owner engaged in what OFAC described as a willful scheme to transfer
nominal ownership of luxury condominiums from two sanctioned Russian
oligarchs to non-sanctioned family members and related shell companies,
resulting in an approximately $1.1 million OFAC settlement plus a DOJ
forfeiture action. The scheme worked because the ownership chain was
designed to defeat casual verification.

4.3 Commercial Substance (18%)

WHAT TO VERIFY

• Real, dedicated business premises --- not a P.O. box, not a shared
  workspace listing.

• Real employees --- headcount consistent with the volume of business
  the distributor claims to handle.

• Real inventory, warehousing, or service capacity appropriate to the
  sector.

• Real customer evidence --- not a logo wall on a website, but named
  references that can be independently confirmed.

WHERE TO FIND IT

• Physical address verification via satellite imagery (Google Earth,
  Mapbox), local mapping services, and cross-check against registry
  records.

• LinkedIn employee counts, staff turnover indicators, and named local
  employees who can be independently corroborated.

• Trade-body membership lists (chambers of commerce, sector
  associations) and industry publications.

• Where verification is inconclusive, a paid site-verification report
  from a local corporate-services firm. MAALAT does not conduct
  in-person site visits at Phase 1 pricing; the Rubric v1.1 states this
  honestly.

FAILURE SIGNATURE

The registered address, when checked, is a virtual office or an
unrelated building. LinkedIn shows two employees where the distributor
claims a national sales force. Named customer references, when contacted
through a channel the distributor cannot control, do not confirm the
relationship or do not exist as businesses at all.

Weighted at 18% because Commercial Substance is the single hardest
attribute to fake. A distributor without real premises, real staff, or
real customers is a distributor that will fail to deliver the moment a
real order arrives, regardless of how convincing the paperwork looks.

4.4 Banking Consistency (12%)

WHAT TO VERIFY

• The payment account name exactly matches the contracting entity.

• The account is held at a bank in the jurisdiction where the entity is
  registered, or an explanation for any deviation is documented in the
  contract.

• No third-party payment redirection is requested at any point during
  the relationship.

• The bank itself is a real, regulated institution, not a
  correspondent-only or shell arrangement.

WHERE TO FIND IT

• Formal bank-details request on the distributor's letterhead, signed,
  with the account name spelled out fully.

• Central-bank licence registry for the receiving institution.

• Explicit contract clause forbidding third-party payment substitution
  mid-relationship without written consent.

FAILURE SIGNATURE

The payment instructions arrive with the account name in a slightly
different spelling than the contract entity. Or the account is in a
third country ("please pay via our UAE subsidiary's account for tax
efficiency"). Or, most commonly, the request to change payment details
arrives by email mid-contract, often citing a bank change or a temporary
issue.

Invoice-redirection fraud, according to the [[Australian Competition and
Consumer Commission data reported by Hicksons
Lawyers]{.underline}](https://www.hicksons.com.au/insight-news/august-2021/did-you-really-pay-who-is-liable-for-payment-in-a),
cost Australian businesses over $132 million in a single reporting
year. The pattern is a mid-relationship email requesting a bank-detail
change; the payment is redirected; the real supplier is never paid; the
buyer learns weeks later when the invoice is chased. The legal question
of who bears the loss is settled: depending on the governing law and
contractual arrangements, the paying party may bear the financial loss
even where the fraud originated in the supplier's compromised email
account rather than the buyer's own systems.

This dimension is weighted at 12% specifically because a failure here is
often the fatal fact. That is why Trigger B, described in Section 6,
caps the band at D if this dimension scores 3 or lower.

4.5 Market Legitimacy (10%)

WHAT TO VERIFY

• Named supplier references --- not the distributor's claim of who they
  supply, but confirmation from those suppliers.

• Named customer references --- confirmed through a channel the
  distributor cannot manipulate.

• Trade-body, chamber, or association memberships consistent with the
  market presence claimed.

• Trade-press mentions, sector publications, and event participation
  records.

WHERE TO FIND IT

• Direct outreach to named references. Use publicly listed switchboard
  numbers, not numbers provided by the distributor.

• Chamber of commerce membership lists and event attendee lists.

• Sector-specific databases (e.g. IHS Markit, Kompass, DunBase, Kompass
  Turkey) for market-share and revenue indicators.

• Google News archive, LexisNexis, and country-specific trade press.

FAILURE SIGNATURE

References cannot be reached through publicly listed channels. Or
references, when reached, describe the relationship differently than the
distributor did (smaller volumes, one-off transactions, contract
disputed). Or the distributor claims membership in a trade body whose
membership register does not include the entity.

Weighted lower than Commercial Substance because market legitimacy can
be partially real for a real firm operating in a documentation-poor
jurisdiction. Evidence Confidence carries most of the weight here: an
honest small distributor in a low-documentation market will score Medium
at Low Confidence rather than being penalised as a fraud.

4.6 Digital Footprint (5%)

WHAT TO VERIFY

• Domain registration age, registrar, and consistency with the claimed
  operating history.

• Corporate email infrastructure on the company domain, not free webmail
  (gmail, hotmail).

• No impersonation of larger firms in the same sector (domain
  typosquats, logo lifts, false partnership claims).

• Reasonable digital hygiene given the sector --- not necessarily a rich
  digital presence, just no red flags.

WHERE TO FIND IT

• WHOIS lookups on the corporate domain. [[ICANN
  Lookup]{.underline}](https://lookup.icann.org/) is the neutral source.

• MX record and email header inspection to confirm the corporate email
  actually resolves through the corporate domain.

• Reverse image search on logos, product photos, and staff photos to
  detect lifts.

FAILURE SIGNATURE

Domain registered three weeks before the distributor first made contact.
Corporate email routes through a public webmail service. The staff photo
on the "About" page appears elsewhere on the internet attached to a
different name.

Weighted at 5% because MAALAT operates across markets where strong
distributors legitimately have thin digital presences. Turkey, the Gulf,
MENA, and Africa all have serious distributors that never invested in
digital marketing. Penalising them at Digital Footprint would
systematically favour Western counterparties in the exact markets the
rubric is built to serve.

4.7 Contract Behaviour (15%)

WHAT TO VERIFY

• The distributor will sign a mutual non-disclosure agreement without
  adding non-standard clauses that limit the client's recourse.

• The distributor will provide documentary evidence (registry printouts,
  licence copies, bank letters) within a reasonable diligence window.

• The distributor does not apply urgency pressure that closes the
  diligence window ("we need to sign this week or the opportunity is
  gone").

• Exclusivity, minimum-purchase, and territory clauses match the sector
  norm; unusual clauses are explained.

WHERE TO FIND IT

• The distributor's conduct during pre-signing negotiation. This is the
  primary evidence source.

• Local counsel review of the proposed contract for
  standard-versus-unusual clauses in the relevant jurisdiction.

• Past-contract history where available (previous exclusivity
  relationships, previous distributor arrangements).

FAILURE SIGNATURE

The distributor pushes for a signing date that does not allow
verification. Or refuses to provide documentary evidence, citing
confidentiality. Or insists on exclusivity from day one with no
performance triggers. Or the proposed contract contains a clause that
shifts an unusual share of liability to the client for issues that would
normally sit with the distributor.

Weighted equally with Legal Existence and Ownership Transparency (all
three at 15%) because contract behaviour is the earliest observable
integrity signal. Everything else in the rubric requires research;
contract behaviour reveals itself in the first two meetings.

4.8 Transaction Anomalies (10%)

WHAT TO VERIFY

• Payment paths match the contract (one payer, one payee, one route).

• Commission structures, if any, match sector norms.

• No third-party settlement patterns appear (payments arriving from or
  going to unrelated entities).

• Invoice patterns match the underlying trade activity.

WHERE TO FIND IT

• Contract text and payment-schedule documentation.

• Bank statements, where available (typically only after the
  relationship begins).

• Sector benchmark for commission and margin structures.

FAILURE SIGNATURE

Commissions are paid to entities not named in the contract. Or invoices
are structured to route value through jurisdictions with weak
enforcement. Or the distributor requests payment in ways ("bearer
cheque," "cash on collection," "payment to our accountant's
account") that would trigger a bank's own AML scrutiny if the
operator's bank were paying attention.

This dimension pairs with Banking Consistency under Trigger B. Together,
they are common features of published sanctions and anti-corruption
settlements. The [[Fracht FWO settlement (September 2025,
$1.61M)]{.underline}](https://ofac.treasury.gov/recent-actions/enforcement-actions)
involved a freight forwarder that failed to identify sanctioned parties
in a transport chain. The [[Unicat Catalyst Technologies settlement
(June 2025,
$3.88M)]{.underline}](https://ofac.treasury.gov/recent-actions/enforcement-actions)
involved a Texas-based catalyst supplier whose CEO used intermediary
companies to conceal end-users in Iran and Venezuela. In both cases,
transaction anomalies were the observable signal, if anyone was looking.

Weighted at 10% on its own, but promoted through Trigger B because a low
score here is a fatal fact regardless of composite.

5. Four integrity-failure archetypes

The following four archetypes are patterns MAALAT has abstracted from
publicly documented enforcement cases. They are named because pattern
recognition is the fastest way to internalise the rubric. No specific
counterparty is being accused of anything here; the underlying cases are
cited so any reader can verify the pattern and its documentation for
themselves.

Archetype 1: The Papered Shell

The distributor has full paperwork --- registration, licence, bank
letter, tax certificate --- but no operating substance behind any of it.
Premises are a service address. Staff are a founder and a bookkeeper.
Customers are unverifiable. The paperwork is designed to survive a
first-pass review; the substance is designed to disappear the moment a
real order arrives.

THE RUBRIC SIGNATURE

• Legal Existence: 8 (High confidence). Ownership Transparency: 5
  (Medium). Commercial Substance: 2 (High). Banking Consistency: 7
  (Medium). Market Legitimacy: 2 (Medium). Digital Footprint: 6
  (Medium). Contract Behaviour: 6 (Medium). Transaction Anomalies: 6
  (Low).

• Weighted composite: approximately 4.9. Band D. Recommendation: DO NOT
  PROCEED WITHOUT INDEPENDENT DILIGENCE.

A NOTE ON PUBLIC ANALOGUES

MAALAT has not identified a single publicly enforced case that matches
the Papered Shell archetype end-to-end on the public record. The
archetype is a synthesis of recurring third-party-intermediary fact
patterns observed across FCPA settlements and sanctions actions where
clean documentation and shell operational substance co-existed at the
point of counterparty selection. Naming a single case as the archetype
would misrepresent both the case and the pattern. What is documented is
the frequency: roughly three-quarters of FCPA corporate settlements
trace back to third-party intermediaries, per Miller & Chevalier's FCPA
Winter Review.

Archetype 2: The Bank-Detail Switch

The distributor is real. The relationship is real. Then, several months
in, an email arrives requesting a change of bank details --- usually
citing a bank consolidation, an account restructuring, or a temporary
issue. The payment is redirected to a new account. Weeks later, the real
distributor asks why they have not been paid.

THE RUBRIC SIGNATURE

• Legal Existence: 9. Ownership Transparency: 8. Commercial
  Substance: 9. Banking Consistency (post-switch, if the switch is
  honoured): 2 (High confidence in the failure). Market Legitimacy: 9.
  Digital Footprint: 7. Contract Behaviour: 8. Transaction Anomalies: 3.

• Weighted composite (if switch honoured): approximately 7.2. But
  Trigger B (Banking Consistency ≤ 3) caps the band at D.
  Recommendation: DO NOT PROCEED WITHOUT INDEPENDENT DILIGENCE.

This is the case where the composite alone would mislead. The
distributor scores well on nearly everything. The single failure on
Banking Consistency, once detected, dominates. That is what Trigger B
exists to enforce.

PUBLIC ANALOGUE

The [[ACCC-reported invoice-redirection pattern documented by Hicksons
Lawyers]{.underline}](https://www.hicksons.com.au/insight-news/august-2021/did-you-really-pay-who-is-liable-for-payment-in-a)
is the direct analogue. In the Australian analysis cited by Hicksons
Lawyers, the default position under Australian law is that the paying
party bears the loss even when the fraud originated in the supplier's
compromised email account. Other jurisdictions and contractual
arrangements may allocate that risk differently.

Archetype 3: The Ownership Chain Trap

The distributor discloses a founder. The founder's company is owned by
another company. That company is owned by a nominee in a jurisdiction
with no beneficial-ownership disclosure. The chain, when reconstructed
through paid ownership databases, reveals a link to a sanctioned party,
a client competitor, or a politically exposed person the distributor
never mentioned.

THE RUBRIC SIGNATURE

• Legal Existence: 8. Ownership Transparency: 2 (High confidence in the
  failure, once the chain is reconstructed). Commercial Substance: 7.
  Banking Consistency: 7. Market Legitimacy: 6. Digital Footprint: 6.
  Contract Behaviour: 7. Transaction Anomalies: 5.

• Weighted composite: approximately 6.0. Band C. If the disclosed
  ownership chain link is to a sanctioned party (Critical Failure),
  Trigger A caps the band at D. If the link is to a client competitor
  with proven undisclosure, Trigger A also caps the band at D.

PUBLIC ANALOGUE

The [[Family International Realty
case]{.underline}](https://ofac.treasury.gov/recent-actions/enforcement-actions)
cited earlier shows the ownership-chain manipulation at the extreme:
luxury condominiums were transferred through non-sanctioned family
members and related shell companies to defeat OFAC screening. The
disclosed ownership was compliant; the reconstructed ownership chain was
not. The OFAC settlement was approximately $1.1 million, plus a related
DOJ forfeiture action.

Archetype 4: The Urgency Frame

The distributor moves fast. The opportunity is described as
time-limited. The contract is presented as standard but includes clauses
that shift unusual liability to the client. Diligence requests are met
with delays; signing pressure is not. The distributor implies that
another party is competing for the same slot and will sign this week if
the client does not.

THE RUBRIC SIGNATURE

• Legal Existence: 7. Ownership Transparency: 6. Commercial
  Substance: 6. Banking Consistency: 7. Market Legitimacy: 5. Digital
  Footprint: 6. Contract Behaviour: 3 (High confidence in the failure).
  Transaction Anomalies: 5.

• Weighted composite: approximately 5.5. Band C. Contract Behaviour at 3
  is not itself a Critical Failure, so no cap applies, but the composite
  lands close to the C/D boundary and the recommendation becomes PROCEED
  WITH STAGED COMMITMENT with elevated documentation.

The Urgency Frame is the archetype the rubric handles most subtly. It
does not produce a hard failure; it produces a signal that the
distributor's contract behaviour is inconsistent with the diligence
patterns of a firm confident in its own legitimacy. That is often enough
to warrant a smaller opening order and shorter initial term, not an
outright refusal.

PUBLIC ANALOGUE

The urgency pattern appears repeatedly in Foreign Corrupt Practices Act
settlements involving third-party intermediaries. The [[Stanford FCPA
Enforcement Action
Dataset]{.underline}](https://fcpa.stanford.edu/enforcement-actions.html)
documents hundreds of cases where the intermediary or distributor drove
signing timelines that later reviewers described as incompatible with
proper diligence. Urgency framing is a soft signal, but a persistent
one.

6. The override triggers

Composite alone is not the verdict. The rubric has two override triggers
that cap the band at D regardless of the weighted average. One fatal
fact overrides eight strong dimensions.

Trigger A --- Critical Failure

A documented Critical Failure automatically caps the band at D. Critical
Failures are named, documentary, and not inferred. They are:

• Dissolved company or struck-off status in the home jurisdiction.

• Forged or falsified registration or licence documents.

• Fake bank account, or payment redirection to a third party outside the
  contract.

• Sanctions breach on any recognised list (OFAC, UN, EU, UK, Turkey).

• Regulator revocation of a required sector-specific licence.

• Proven undisclosed common ownership with a competitor of the client.

• Confirmed impersonation of another firm.

Each of these is a fact that, on its own, makes the distributor unfit to
proceed with under normal terms, regardless of how well the other
dimensions score.

Trigger B --- Forensic Weakness

A score of 3 or lower on either Banking Consistency or Transaction
Anomalies specifically caps the band at D. These two dimensions are the
hardest to fake, so weakness in either dominates the composite.

The rationale: real distributor fraud rarely shows up as a clean 0 on
all dimensions. It shows up as messy 2s and 3s in banking and
transaction behaviour, alongside 7s and 8s in the paperwork-facing
dimensions. Without Trigger B, a composite of 6.5 could hide a fatal 2
on Banking Consistency. Trigger B closes that false-positive gap.

7. The 15-minute distributor test

The full application of the rubric takes 15--25 hours per counterparty
when done to MAALAT's Distributor Integrity Review standard. Not every
distributor warrants that investment. The following one-page test is the
compact version: it takes 15 minutes, uses only free tools, and produces
a first-pass go/no-go signal.

If the compact test raises concerns on three or more items, escalate to
the full review. If it raises concerns on any item flagged CRITICAL
below, treat it as a hard signal regardless of the count.

---------------------------------------------------------------------------
# CHECK WHERE SEVERITY
-------- ----------------------- --------------------------- --------------
1 Company registration is Home-country registry CRITICAL
current, not dissolved, (Companies House, MERSIS,
not struck off MoC, etc.)

2 Trade licence matches Sector regulator database CRITICAL
the entity name exactly

3 Registered address Google Earth or equivalent High
exists as a real satellite view
building consistent
with an operating firm

4 LinkedIn employee count LinkedIn company page High
consistent with the
claimed operating scale

5 Domain age consistent ICANN Lookup or equivalent Medium
with the claimed WHOIS
operating history

6 Corporate email routes Email header inspection Medium
through the corporate
domain, not free
webmail

7 The distributor is not OFAC SDN List, UN, EU, UK CRITICAL
on any sanctions list consolidated lists

8 Named beneficial owner UBO registry where High
is a real, identifiable available; Google +
individual (not a LinkedIn otherwise
nominee)

9 One named customer or Direct call, not High
supplier reference distributor-provided number
confirmed through a
public switchboard
number

10 Distributor accepts a Observed conduct in first High
normal diligence window two meetings
(7--14 days) without
urgency pressure
---------------------------------------------------------------------------

This one-page test is the free preview of MAALAT's methodology. It is
deliberately conservative: it catches the most common failures, but it
is not a substitute for the full Distributor Integrity Review, which
applies all eight dimensions with documented evidence and Coverage %
reporting.

8. The five documents that resolve most cases

Every MAALAT Distributor Integrity Brief closes with the same one-page
instruction: obtain these five documents from the distributor, and
roughly 70% of integrity questions are settled before the full review
begins. This section names the five.

Obtaining these documents is not the same as verifying them. A forged
licence PDF and a real one look identical in an inbox. The remaining
30%, and the confirmation that what was handed over is genuine, is what
the paid Distributor Integrity Review checks against live registries,
the issuing bank, and named references.

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A distributor who cannot or will not produce these five documents inside
a 14-day diligence window is telling the operator something important
about how they intend to handle the relationship. Refusal is itself a
data point. The MAALAT recommendation, when this happens, is not to
escalate; it is to walk.

9. What MAALAT does with this rubric

This playbook is the free, public methodology. The paid product is the
Distributor Integrity Review: MAALAT applies the eight dimensions to one
specific distributor the operator names, with documented evidence for
each dimension, Evidence Confidence tagged per dimension, Coverage %
reported on the front page, and a locked recommendation.

The paid deliverable includes

• Full corporate registry extract and interpretation (Legal Existence).

• Beneficial-ownership graph, including affiliates and related-party
  detection (Ownership Transparency).

• Commercial-substance assessment based on premises, staff, inventory,
  and customer verification (Commercial Substance).

• Bank-name reconciliation and payment-routing consistency check
  (Banking Consistency).

• Independent supplier and customer reference verification through
  publicly listed channels (Market Legitimacy).

• Domain, email infrastructure, and impersonation-risk audit (Digital
  Footprint).

• Contract-behaviour assessment based on documented distributor conduct
  during diligence (Contract Behaviour).

• Transaction-pattern review based on contract terms, commission
  structure, and sector benchmarks (Transaction Anomalies).

• Composite score, band, override-trigger check, and locked
  recommendation word.

• The Top Five Documents closing checklist.

What is not included

• In-person site visits. At MAALAT's current price point, verification
  is remote and documentary. Where a site visit is required, MAALAT
  recommends a paid local corporate-services firm.

• Regulated enhanced due diligence. Where MAALAT's recommendation is
  Band D, the operator should engage a regulated EDD provider (LSEG Risk
  Intelligence, Kroll, Neotas, Refinitiv) before commitment. MAALAT does
  not compete with those providers; MAALAT is the fixed-price triage
  that determines whether their engagement is warranted.

• Ongoing monitoring. The Distributor Integrity Watch subscription,
  launching in Phase 2, provides quarterly re-scoring against the same
  rubric.

Refresh cadence

Distributor Integrity Reviews have a 6-month validity window. After 6
months, a standalone re-review is available at 60% of the original
price. The rationale: registry status, ownership, and licensing change;
a review is a snapshot, not a permanent state.

10. How to request a Distributor Integrity Review

If the operator is about to appoint a distributor, sign an exclusivity
clause, or commit inventory or capital, the Distributor Integrity Review
should be completed before any commercial commitment is made. The cost
of the review is a small fraction of the cost of a wrong distributor and
a fixed fraction of the value of a right one.

The Distributor Integrity Review is a fixed-price, fixed-scope product.
Pricing is transparent and posted publicly:

-----------------------------------------------------------------------
SERVICE PRICE SCOPE
-------------------------- ------------ -------------------------------
Distributor Integrity $299** One distributor. Eight
Review** dimensions. Composite score,
band, and recommendation. 5--7
business day turnaround.

Distributor Integrity $499** One distributor. All of the
Review --- Extended** above, plus Ownership Chain
reconstruction across up to
three jurisdictions and formal
Reference Verification of two
named customers and one named
supplier.

Distributor Integrity $699** Two distributors reviewed
Review --- Comparative** side-by-side against the same
rubric, with a comparative
recommendation. Useful when the
operator is choosing between
two candidates.
-----------------------------------------------------------------------

All three tiers include the front-page Coverage % metric, Evidence
Confidence tags per dimension, and the Top Five Documents closing
checklist.

+-----------------------------------------------------------------------+

| **WHAT COVERAGE % AND EVIDENCE CONFIDENCE LOOK LIKE ON THE FRONT |

+-----------------------------------------------------------------------+

The intake process

• Order via the Stripe link on maalat.co (payment first, no invoice
  needed).

• Receive intake questionnaire by email within 4 business hours.

• Return the questionnaire with the distributor's name, jurisdiction,
  and any documents already in hand.

• MAALAT delivers the completed review as a PDF within 5--7 business
  days (standard) or 3 business days for a $99 rush surcharge.

The engagement is single-transaction and complete. There is no retainer,
no NDA required to start (MAALAT signs the operator's NDA on request),
and no scope creep. What is priced is what is delivered.

The MAALAT guarantee

Because MAALAT is a fixed-price, fixed-scope research product with no
direct client contact, two guarantees carry the trust:

• Turnaround guarantee. If MAALAT does not deliver the completed
  Distributor Integrity Review within the stated turnaround (5--7
  business days standard, or 3 business days on the rush option), the
  fee is refunded in full. No exceptions, no partial credits, no
  rescheduling.

• Scope-completeness guarantee. If the delivered review is materially
  incomplete against the eight dimensions and deliverables listed in
  Section 9 above, the fee is refunded in full. "Materially incomplete"
  means one or more of the eight dimensions is missing from the
  delivered PDF or has been left without a documented finding.

These guarantees exist so that a first-time engagement does not require
prior familiarity with MAALAT. The operator pays; if MAALAT does not
deliver on time or on scope, the operator gets the money back. That is
the entire risk model.

+-----------------------------------------------------------------------+

+-----------------------------------------------------------------------+

Sources

Every publicly documented case referenced in this brief is verifiable
through the sources below. MAALAT does not accuse any specific firm of
wrongdoing; archetypes are patterns abstracted from public enforcement
records.

• [[U.S. Treasury OFAC 2024 Civil Penalties and Enforcement
  Information]{.underline}](https://ofac.treasury.gov/civil-penalties-and-enforcement-information/2024-enforcement-information)
  --- official record, 12 published enforcement actions, $48.79M
  aggregate.

• [[U.S. Treasury OFAC 2025 Civil Penalties and Enforcement
  Information]{.underline}](https://ofac.treasury.gov/civil-penalties-and-enforcement-information/2025-enforcement-information)
  --- official record, 14 published enforcement actions, $265,746,819
  aggregate as of the current register update.

• [[U.S. Treasury OFAC Recent
  Actions]{.underline}](https://ofac.treasury.gov/recent-actions/enforcement-actions)
  --- Family Realty, Unicat, Fracht, and related settlement notices.

• [[ACCC invoice-redirection data cited by Hicksons
  Lawyers]{.underline}](https://www.hicksons.com.au/insight-news/august-2021/did-you-really-pay-who-is-liable-for-payment-in-a)
  --- $132M annual loss figure and legal-liability analysis.

• [[Stanford Law School FCPA Enforcement Action
  Dataset]{.underline}](https://fcpa.stanford.edu/enforcement-actions.html)
  --- the primary academic archive of FCPA settlements.

• [[Miller & Chevalier FCPA Winter
  Review]{.underline}](https://www.millerchevalier.com/publication/fcpa-winter-review-2022)
  --- third-party intermediary role in FCPA cases.

• [[Morrison Foerster 2024 U.S. Sanctions Enforcement
  Roundup]{.underline}](https://www.mofo.com/resources/insights/250424-u-s-sanctions-enforcement-2024-lessons-learned)
  --- practitioner analysis of 2024 OFAC settlements.

• [[Sidley Austin 2025 U.S. Sanctions Enforcement
  Takeaways]{.underline}](https://www.sidley.com/en/insights/newsupdates/2026/02/five-key-takeaways-from-2025-us-sanctions-enforcement)
  --- practitioner analysis of 2025 OFAC settlements.

This brief is Problem Brief #02 in the MAALAT library, published July

2026. It is free to read, forward, or reproduce with attribution. It
      supersedes no earlier MAALAT publication and creates no client
      relationship.