The National Bank of Ukraine (NBU), during its supervisory activities, identified transactions involving resident companies that may indicate the use of so-called "tax carousel fraud" and "mirror flows," and has recommended that banks take the relevant indicators into account when assessing customers and their transactions, according to a letter sent by the regulator to banks and banking associations.
The NBU said that such schemes are aimed at tax evasion and/or the legalization (laundering) of proceeds of crime, terrorist financing, or the financing of the proliferation of weapons of mass destruction.
Imported goods may be sold through networks of wholesale and retail traders that possess substantial volumes of unrecorded cash. During the movement of goods through chains of affiliated companies, one type of product may be substituted for another in the accompanying documentation. As a result, companies may artificially reduce their tax liabilities or unlawfully obtain VAT refunds from the state budget.
Such schemes primarily involve newly established companies or enterprises that have been effectively inactive for extended periods and may display characteristics of shell companies.
Among the risk indicators, the regulator cited a small number of employees, low authorized capital, a lack of assets necessary for the declared business activities, frequent changes in management, ownership, addresses, and business activities, as well as multimillion-hryvnia turnover despite the absence or insignificance of declared income.
Other warning signs include the unjustified use by several companies of the same IP addresses, telephone numbers, email addresses, accountants, or representatives, as well as dealings with a large number of newly established counterparties.
With regard to newly established importers, the regulator recommended paying particular attention to multimillion-hryvnia transfers to nonresidents for goods already imported without advance payment, the absence of documentation confirming transportation, storage, and the actual movement of goods, and cash inflows inconsistent with the company's stated business activities.
Indicators of such schemes may also include the absence or minimal volume of routine business expenses such as rent, utilities, payroll, and taxes, as well as transit movement of funds, whereby nearly all incoming payments are directed within several days toward payment for goods under foreign trade contracts.
The National Bank also recommended that banks pay attention to situations in which importers purchase foreign currency using substantial loans or borrowings from financial companies, where the financing terms are economically unjustified and the debt is either not repaid or repaid only in insignificant amounts.
Separate indicators of fictitious transactions identified by the NBU include contracts concluded before the company was established, contracts specifying bank accounts opened after the contract date, and agreements signed by executives who had not yet been appointed at the time of signing.
Banks are advised, both before establishing business relationships with an importer and throughout the servicing of the client, to determine how and to whom the importer sells goods, whether it operates a retail outlet or online store, whether it has warehouse facilities, and whether it possesses other resources necessary to conduct its declared business activities.
If risk indicators are identified, the bank should be prepared to justify why it did or did not take appropriate measures regarding the client and its transactions, while the central bank will consider the actions taken by banks during its supervisory reviews.
As reported, in January 2026 the NBU urged banks not to rely solely on a formal approach when identifying shell companies. The regulator recommended that, whenever even one risk criterion is identified, banks conduct a comprehensive analysis of the client's documents and business activities, including information on salary payments, tax payments, rent, utility expenses, and transportation costs.
In addition, banks were advised to establish limits on certain services for newly established and high-risk companies in order to prevent large transactions from being conducted without proper justification immediately after an account is opened, as well as to improve automated detection of suspicious transactions.
