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Background checks have become a mandatory and wise step in compliance processes. We contact new clients, new employees and potential partners on a daily basis and opportunities are everywhere, but what's the risk?
Beyond the basic answers, a background check is a smart step to find out who or what you’re dealing with as these investigations include specific steps covering different aspects of the target reflecting the broad parameters and depth required by compliance standards :
- You can begin by checking all the open sources of information available and the web is, or course, the best place to search as there are many online services accessible to anyone with a connection.
- The second step should be directed to checking the target's mandates, memberships and participation in other companies, groups or associations. This is where social and professional networks such as LinkedIn are goldmines, often times containing very detailed corporate and business information. However, you must be aware that the posted information is provided by the target and therefore not controlled nor confirmed.
- Once you gather this data, you can then compare it between data bases from legal records or debt collectors. These documents are accessible to most although can incur substantial costs and delays. This information should also be enhanced with information from the world press.
While these are good steps to follow, verified and cross-checked data is difficult to source and confirm and the time it takes to gather and reconcile data from publications is very laborious and time consuming. Fortunately, professional financial investigators have access to several closed databases and are able to verify and produce accurate information on a timely basis.
- The next step would indicate direct telephone contact with the target although it is a traditional technique and sometimes considered obsolete, nevertheless, it can also provide current data and support to measure the credibility of the target individual or corporation. Moreover, it is also recommended you contact providers or associates to gauge the target’s marketplace reputation as well as physically verifying their address. All of this is, of course, difficult to achieve on your own, and certainly not within the timeline professionals provide and there remains much critical data that is only available with access to dedicated data bases, the press or on the internet, all at your own risk.
- The ability to recognise and monitor any red flags such as fraud, scandal or corruption, requires eyes everywhere unless you have the time, money and network required in this dynamic marketplace. This final component is reserved for professional organizations who have access to specialized networks and the means to measure the accuracy of data in real time.
Don’t forget that the more you know about the target, the more you are likely to control and benefit from the situation.
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