We perform background checks of executives, directors, and prospective and current employees, as well as due diligence of corporate entities, within the U.S. and internationally. Each project is tailored to the appropriate level of analysis and discretion, and with consideration as to relevant federal and state laws. Based on our review and inquiries, we develop a personal, professional and litigation profile of the subject summarized in a clear and concise report.
Many background checks return clear and positive information, and add to the level of confidence our clients have in making appointment and investment decisions. The examples below indicate instances in which we identified significant information of concern. In some of these examples, the initial inquiries were returned with clear results, but negative information surfaced during the analysis phase in which we delved further in relevant research directions – sometimes identifying conflicts of interest, a string of unpaid judgments, or misrepresented professional history.
We have conducted background due diligence of acquisition targets and management teams internationally, including in countries across six continents.
- We uncovered that the principal of a management team had misrepresented significant aspects of his professional and personal background. With this information, our client re-negotiated the terms of their investment deal, limiting this individual’s role in the target company.
- In the course of international due diligence on a company founder, we discovered that several of his financial services and trading companies had come under scrutiny in the U.S. and in Europe, with regulatory bodies issuing warnings to investors. Although the company founder himself had a relatively clean record, he had left a trail of failed businesses internationally. Our client decided not to enter into business with this individual.
- We identified ties to organized crime for the founder of a company in which our client, a private equity firm, was looking to invest. The client avoided the investment which might have otherwise potentially caused them public embarrassment and financial issues.
- In performing due diligence of candidates for a public board, we identified material information for some of the candidates, including securities class action litigation pertaining to allegations of false and misleading statements made to the SEC and to the investing public, and artificial inflation of stock prices and stock-option backdating. Our client was able to make an informed decision regarding their board appointees, selecting those with a clear record and less potential liability.
- We were retained by a manufacturing company to investigate a potential acquisition target and the chief executive. We discovered that a construction company, owned by the individual subject, had been cited for over a dozen workplace violations by the Occupational Safety and Health Administration (“OSHA”), and the company had been fined approximately $1 million in penalties. The individual subject had been sued successfully in federal court on two occasions for non-payment of employee wages and benefits. In addition, he had personally been subject to judgments and tax liens totaling nearly $1 million, within the previous ten years.