Case Study: Don’t Rush Your Research

As many of you have realized, a big component of our company is providing background checks for employment purposes, due diligence on business partners and potential investments, litigation support, and other investigative needs. We’ve spoken at length on our blog and podcast about the law, information you’ll need to provide, turnaround time, and fees. We’ve also discussed how important methodology is for investigations, why databases are not enough, and the importance of going to the direct source (i.e., in-person court searches). Luckily for us, many have listened. This leads to a smoother, more efficient and effective process for obtaining the best available intelligence to help clients make informed decisions. 

One thing we haven’t discussed at length is the need to give an investigation time to uncover critical information. In this case study, the investigation revealed significant information that the client may not have obtained without following our process and giving investigators the time they needed.

Situation

A large multinational client was about to engage with a consulting firm on a significant project. Following its standard protocol, the firm asked Integras to conduct due diligence on the firm and the principal. Unfortunately, the process started later than usual, and the client wanted investigation results sooner than our standard turnaround time. The request came late on a Friday. Courts were already closed until Monday, and the client wanted results by Tuesday.

Solution

We explained that the timeline did not allow a thorough investigation. However, we also understood that our client was under pressure to deliver, so we developed a plan to provide preliminary results by the requested date, with a full report to follow. 

The preliminary report was based on the following research of the company and principal:

• Review of database reports
• Derogatory media and internet research

The focus of this research was to identify potentially derogatory information—and it proved fruitful. We identified two civil matters concerning the company and three more involving the principal. Many of these matters were relevant to the project that our client was planning with this firm. The matters resulted in civil judgments against the company and principal for more than $50,000. Additionally, investigators found media articles that referenced other court matters.

After Integras conducted the full investigation, the end results were staggering. Here are some highlights:

• The company was not in good standing with one of the states in which it conducted business.
• More than 30 civil matters were identified through in-person research; the total judgments against the company and principal amounted to several million dollars.
• A bankruptcy was tied to the principal.
• Numerous derogatory media references were found against the company and principal.

Conclusion

Don’t rush or take shortcuts to complete investigations, especially when the results will be used to support significant decisions. The findings of our preliminary research through databases and online research differed considerably from those of our full investigation. This situation happens often.

Based on the preliminary report, the client was prepared to proceed with the consulting company, but we recommended that they wait for the final results since we had already uncovered references to additional legal actions. Luckily, they listened. In the end, they were able to make a decision with a much more complete picture.