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Corruption Risks / Common Malpractices in Different Stages of Start-up

image_seeking_funds Seeking Funds Click to view the risks

Typical sources of funding for start-ups

  • Government grants and subsidies programme
  • Incubation or acceleration programmes
  • Private venture capitals or angels
  • Bank loans


Corruption Prone Areas

  • Applicants offers advantages to handling staff of applications, assessment panel of funding programmes or representatives of potential investors for favouritism in the application process
  • Start-up proprietors fabricate transactions, statistics or submitting bogus documents for funding applications
image_start_up Setting Up Company Click to view the risks

To-dos for setting up a company

  • Business and company registration
  • Patent, copyright or trademark registration
  • Licence or permit application
  • Opening business bank account


Corruption Prone Areas

  • Applicants offer advantages to the handling or approving staff for the latter’s speeding up the application process or turning a blind eye to insufficient documents submitted
  • Start-up proprietors or representatives offer gifts to public officials while having dealing with the government department or public organisation
  • Applicants submit bogus supporting documents for applications
image_getting_product Getting Product Ready Click to view the risks

Steps to get your product ready

  • Selection of suppliers or manufacturers
  • Negotiation with service providers
  • Quality control


Corruption Prone Areas

  • Start-up partner appoints companies with financial or personal interests as suppliers or contractors without the consent of other partners
  • Company partner or staff responsible for purchasing select suppliers or contractors who offered personal advantages
  • Colluded partners or staff leak proprietary information to competitors
  • Goods receivers cover up non-deliveries or accepting substandard goods
image_reach_out Reaching Out For Business Click to view the risks

Types of customer

  • Corporate/Individual client
  • Local/Overseas client


Corruption Prone Areas

  • Start-up proprietors offer advantages to representatives of corporate clients to boost sales or secure orders
  • Individual partner divulges clients’ information to third party for personal gain
  • Non-compliance with laws and regulations of other jurisdiction when dealing with overseas buyers or officials