Red flags & scams

Who this is for / not for

This guide is for anyone buying formation, banking, or compliance services and wants to spot scam patterns and run basic due diligence. It is not legal advice; it is a practical checklist to reduce risk when choosing providers.

Decision summary

  • Be wary of guaranteed bank accounts, no-questions-asked setups, or pressure to pay upfront without clear deliverables.
  • Use a safe buying process: verify the provider, check contract clauses (refunds, scope, liability), and keep evidence of what was agreed.
  • Red flags include fake reviews, opaque pricing, and requests to misrepresent your business or funds.

Banking & payments reality

Legitimate providers do not guarantee bank approval; banks decide independently. Anyone promising “we always get accounts” or “no KYC” is a red flag. See Bank account opening checklist for what banks actually need.

Costs & timeline

Transparent pricing and realistic timelines are a sign of a serious provider. Unclear fees or “pay more for fast track” without a clear service description can be a red flag. See Costs, timelines, hidden fees.

Docs & KYC checklist

No legitimate provider should ask you to lie on forms, hide beneficial owners, or fake source of funds. If someone suggests misrepresenting your situation to a bank or processor, walk away. See Bankability checklist for what to prepare honestly.

Common failure points / red flags

Scam patterns: upfront payment with no clear contract or deliverables; guaranteed bank account; “off the books” or secrecy-focused sales pitch; fake or unverifiable credentials; pressure to act immediately; requests to transfer funds to personal accounts or unknown entities.

Due diligence checklist: Verify company name and registration; check independent reviews or references; read the contract for scope, refunds, and liability; ensure pricing is in writing; avoid paying large sums before any deliverable.

Alternatives

Use vetted or well-known providers where possible; see Partner standards and Request introductions. Compare several options and do not rely on a single channel (e.g. only Telegram or WhatsApp).

FAQ

What contract clauses should I check?
Scope of services (what is included); payment terms and refund policy; what happens if the bank declines; liability limits; termination. Get it in writing before paying.
Is “guaranteed bank account” ever legitimate?
No. Banks decide independently. A provider can introduce you and help with the pack, but they cannot guarantee approval. Anyone who claims otherwise is a red flag.
What if I already paid and something feels wrong?
Stop further payments; keep all correspondence and contracts; try to get a refund per contract terms. If you suspect fraud, report to your bank and consider reporting to the relevant authority in the provider’s jurisdiction.
Should I pay via crypto or wire to a personal account?
Legitimate businesses typically invoice from a company and accept normal payment methods. Paying to personal accounts or only crypto with no paper trail increases risk.
How do I verify a provider?
Check company registration in their jurisdiction; look for independent reviews; ask for references; confirm they have a real address and contact details. Be cautious if they exist only on one platform or messaging app.

Next steps