When potential risks with business partners are identified, or when business partners are in high-risk jurisdictions or industries, additional insight and analysis is required into the company and/or the principals’ history, reputation, and personal and professional background.
Our Enhanced Due Diligence Solutions (Level I and Level II research) uncover risk-related information that allows our clients to make confident, well-informed business decisions.
The Enhanced Due Diligence solutions are cost-effective and offer rapid turnaround to meet the needs of evaluating potential investments and business partners, and to meet regulatory compliance requirements (AML, KYC, FCPA), particularly in higher risk jurisdictions. Our solutions leverage a potent blend of data, technology and human intelligence, enabling us to develop deep insights as quickly as possible. As with all our services, Enhanced Due Diligence can be managed by our clients via Kroll’s Due Diligence Portal, which allows programmatic management of due diligence activities.
In both English and the local language, Kroll’s analysts review a wide range of media sources, as well as federal, state and local regulatory and court databases to confirm professional registrations and ownership, and to assess regulatory exposure and involvement in legal proceedings. In jurisdictions where less information is available online, where more insight is needed about a subject’s corporate affiliations, or where perspectives on a subject’s character, political connections and business practices are desired, our Enhanced Due Diligence research augments the public record with in-country and on-site research.
Kroll’s Enhanced Due Diligence team is highly skilled in research, observation and inquiry, and includes former prosecutors, journalists, law-enforcement agents and experienced industry professionals. They unearth hidden information and identify patterns to create detailed portraits of subjects’ business activities and overall reputation.
Case Study: Investment Bank Researches US Hedge Funds
As part of a multi-national investment bank’s due diligence process as it considers business relationships with US-based hedge funds, Kroll conducts public record inquiries concerning the funds, investment advisors and founders. Kroll’s research includes regulatory records, media and internet coverage, litigation records, as well as educational and professional licensing verification. In one case, it was determined that the investment advisor and founder of a hedge fund had a questionable past, and had paid the US government $1.5 million to settle allegations of violating federal conflict of interest rules. Based on Kroll’s research, the investment bank suspended its investment in the hedge fund pending further internal review.
Case Study: Global Bank Examines Potential High Net Worth (HNW) Customers in China
A global bank has engaged Kroll to provide due diligence reports to support its AML/KYC program regarding high net worth individuals based in China. The client’s objective is to identify any key risks before agreeing to accept the individual as a customer, and to do so in a short timeframe. Our research into the subjects’ sources of wealth have identified several instances where wealth may have been obtained by improper means, and in those cases, we have conducted deeper research to provide our client a more nuanced view of their potential customers.
Case Study: Multi-National Firm Seeks Level II Work in Brazilian Energy Sector
A multi-national client in the engineering, consumer products and aerospace industries sought Level II due diligence on an energy company and two principals based in Brazil. The client had received an anonymous letter claiming that its relationship with this company was tainted with corruption, specifically with regards to a contract between the client and a Brazilian energy company. Comprehensive research of regulatory, litigation, media and Internet databases revealed limited information regarding the subject company. Adverse media was identified regarding one of the subjects, who was noted to have been a partner in a company allegedly involved in fraudulent activities. As part of the Level II review in Brazil, contact was initiated with local sources familiar with the Brazilian law enforcement and judicial communities. Additional database and reputational inquiries determined no law enforcement interest in or adverse information regarding the subjects of interest.