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How to Verify a Company or Individual Overseas – Due Diligence

Posted On   date14/07/2015

How to Verify a Company or Individual Overseas – Due Diligence

Being international is part of the modern era, especially when it comes to doing business. Most of business today is global.  Whether you are a manufacturer, broker, franchise, exporter, importer, logistics expert or in the service industry, at some point you will receive an inquiry from an overseas company that expresses interest in your products or services. Or at some point you will need to go out there and look for someone overseas, a company, a freelancer or a consultant, who can be your provider. But the questions that you should ask go a lot further.  Are you ready?

It is true that great opportunities don´t wait for long, but rushing can be one of the greatest and costliest mistakes. If you’re worried about the authenticity of a company or individual, or simply want to be cautious, it’s always worth verifying if they’re legit before you have any dealings with them whatsoever. After all, scammers do exist and you don’t want to be the next to be duped, especially if you can avoid it with international due diligence.  Those who fail to do their homework and properly verify individuals and companies end up losing big in the international investment markets.

The most common practice these days from fake foreign companies is to approach corporations or medium to small businesses online.  The Internet has benefited all the bad guys with the gift of anonymity and a fake company can look quite professional and reliable online, but there’s almost no way to know for sure if you haven’t been there or haven’t verified all the known information.  Fake websites look professional, and fake companies often even have real business registrations, but have no actual operations.  Some fake and fraudulent companies even trade on real stock exchanges!

To screen a company prior to an M&A process or prior to making payment is a wise move. According to international private investigators around the globe, due diligence can prevent companies from falling into major and costly traps involving foreign partners.  Experienced private investigators add a layer of protection by providing you with factual information you cannot obtain alone.

How to verify the facts?

Start by asking the right questions. When you are going to enter into a new business deal, you will need information in order to begin with the investigation. Basic data like legal registration (in the case of a company) and full names and references of its main representatives or owners is extremely important.  Get as much information about the operations of the company, where is it located, who are their clients and providers, etc. The more information you have in your hands, the more things professional private investigators can verify and the more you can protect your business from fraud.  Expert investigators can help you make a safe and informed decision.

It is crucial to find the right investigation firm to check all the data that you have been able to gather. If you’re in the U.S. or Canada, and you’re thinking of doing business with a new company or person in China, Malaysia, Ghana, Korea, Philippines, Russia or any place on the map, you need a local and trained investigator who speaks the same language to verify facilities, reputation, business filings, check references, verify ownership and operations, and screen the case for fraud.

Due diligence is complicated and it should be done by an experienced professional, who has real knowledge of local and international regulations (labor, health, safety, environment, privacy). Checking for court records and litigation history is not that easy in many of the developing countries, so having access and knowing the right places to look for the information makes all the difference. So does working with a professional with highly ethical practices that will avoid getting your company in more trouble for breaking privacy or other kinds of laws.  But, the most important is having a trained investigator on the ground in the country or city where you need him, who speaks the language and who can verify the office, operations, employees and gather real evidence.

Take as much time as you need to review everything. Yes, you might be close to a deadline or feeling pressured by the other party, but taking the time to verify and check absolutely everything can save your company from serious trouble and major financial losses.

Contact us today for a free and confidential quote for due diligence.

C. Wright
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