A private equity investment firm engaged LexPro Research LLC to perform domestic and international due diligence on a strategic C-level executive, touting a successful career in the technology industry with expertise in the APAC region.
In addition to traditional public record and investigative database research, using confidential international sources in Asia, discreet reputational interviews were undertaken with a diverse group who knew the executive.
It was reported the Subject was well known in the Hong Kong business community, especially in the mobile telecommunications sector. The Subject was described as “a go-getter, hard-working and ambitious. However, sometimes [the Subject] pushes too far to get what he wants, including treading on others.”
Another source reported the Subject was “not particularly liked and acted as if he wanted to take over. The Subject gave the impression he knew things better than we did and old timers were not adequately aware of modern trends in the software sector.” The source added the Subject was “prone to name-dropping,” suggesting he knew people in important high-level roles at prospective clients, “but no new deals came to fruition from his efforts.”
Although largely cooperative, the Subject was seen as “full of energy and self-confidence, even going as far as arrogant.” Another key source questioned the Subject’s corporate loyalty and risk-taking tendencies, believing “if a marginally better opportunity came along, he would leave the company or put his own interests above the company’s,” describing the Subject’s behavior as akin to “a gambler’s excitement when the ball is spinning around the roulette wheel.”
LexPro Research’s background checks and research methodology goes beyond traditional channels. Using confidential and discreet reputational inquiries can reveal another dimension to assist with your deal due diligence decisions.
A major construction company was served with a wrongful termination suit by its former chief executive officer. Working with the company’s general counsel and outside law firm, LexPro Research was able to uncover significant information regarding the former CEO’s past. Specifically, LexPro Research identified at least one previous employment position the former CEO had omitted from the resume he originally supplied to the client before being hired. Further research determined the CEO had been sued for sexual harassment, while leading the company he had omitted from his resume. Using the information LexPro Research was able to develop, the client was able to bring the wrongful termination suit to a close.
LexPro Research was contacted by a U.S.-based real estate company that had been approached by a businessman who claimed to be from Qatar. Through international inquiries, LexPro Research determined the individual was in fact from Pakistan. Additional research revealed the businessman in question had no experience or qualifications to accomplish any of what he proposed.
In connection with one of the largest corporate mergers of the past few years, LexPro Research vetted the board of a U.S. company before it was acquired by a major European conglomerate.
The client engaged us to research three leaders of a Bioscience firm. Two of the executives had “normal” profiles, but the third, and one of the co-founders, had multiple “red flags.” LexPro Research identified a regulatory action stating the co-founder violated state securities laws. He was accused of, and ultimately admitted to, misrepresenting investment opportunities, omitting material information from investor solicitations, and not registering with the state regulators. He was ordered to make repayments to investors and fines totaling $5 million. The case was also detailed in media articles. Additional research revealed numerous state civil litigation cases, several state and federal tax liens, multiple judgments, and as well as disclosures on his FINRA registration. While we do not have a crystal ball to predict the future, one of the best indicators of someone’s future behavior is his or her past behavior.
A high net worth individual was considering a deal with a U.K. citizen. LexPro Research’s work revealed the individual was in fact a Danish businessman who fled Denmark under suspicion of fraud and corruption charges.
Our client was considering an investment in an online gaming concern based in Costa Rica. Not only was LexPro Research able to conduct background research on the company and its Costa Rican executives in a timely and cost-efficient manner, but during the work LexPro Research discovered the company was in fact owned by two U.S. individuals, one of whom had served a federal prison sentence for illegal bookmaking.
On behalf of a U.S.-based power company that was considering a joint-venture with a Saudi concern, LexPro Research conducted due diligence and background research on the Saudi principal. Not only was LexPro Research able to confirm the Saudi’s credentials, but because LexPro Research was able to determine that the individual was in fact a member of the Royal family and exactly who his siblings are, the client was able to mitigate and avoid potential Foreign Corruption Practice Act (FCPA) issues related to the joint-venture.
Based on intelligence obtained by LexPro Research, a high net worth client was protected from being the victim of a loosely organized ring of fraudsters that had approached the client on several different fronts over an extended period. For several years the client has asked LexPro Research to obtain reputational information on individuals that often approach the client with various business opportunities. Although some individuals were whom they purport to be, others were not. LexPro Research was able to develop information on one individual who was previously involved in a failed restaurant venture, resulting in several lawsuits and many disgruntled investors. Approximately a year later the restaurateur was convicted of perpetrating a major financial fraud – a Ponzi scheme. Further research revealed that at least two other individuals that LexPro Research had previously screened for the same client, and who the client avoided based on our findings, were also ultimately involved in the Ponzi scheme as well.
LexPro Research was engaged to develop information regarding a high-profile individual’s whereabouts and current activities. Using several investigative methods, LexPro Research was able to track the individual’s whereabouts for several weeks on practically a constant basis. LexPro Research first learned the individual was out of the country and sailing the world on his custom yacht. Through additional efforts, we learned the yacht’s exact whereabouts and scheduled itinerary. Finally, LexPro Research was able to obtain other detailed information such as the Subject’s daily activities aboard the ship, who else was onboard, how the passengers spent their days, and even what meals were served. LexPro Research was also able to obtain numerous photographs on a daily basis, many of them of the Subject.
A U.K.-based investment fund was partnered with two U.S. businessmen to invest in South American gaming operations. The U.K. client was being asked for additional funds to cover “unexpected shortfalls” with the initial investment. LexPro Research uncovered an undisclosed relationship between the U.S. businessmen and the South American gaming concern. Furthermore, LexPro Research discovered the U.S. businessmen and South American entity were diverting revenue from the partnership involving our U.K. client. Based on the evidence LexPro Research developed, the U.K. client was able to extract itself from further loses.
