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Company Verifications an Important Tool in Fighting Fraud

Posted On   date14/01/2014

Company Verifications an Important Tool in Fighting Fraud

Because of the increasing statistics showing business fraud cases climbing in record numbers, now is more of an important time than ever to verify unknown companies and new contacts.  Even if who you believe you’re dealing with a real company or representative, and have no reason to suspect fraud, it’s important to conduct some due diligence when you’re establishing new relationships.  You should never enter into a deal with an unknown firm or person without verifying the information first.

By verifying a company, it helps to eliminate fraud by ensuring that the business is an actual company, and if the person who claims to be the key contact person is really a part of the firm.

Going on-site to verify a company

A good deal of verifying a firm involves visiting the actual company in person, even if it means traveling far distances. Searching the internet alone rarely provides sufficient answers, so don’t play the role of a private detective unless that is your area of expertise!  If you’re considering a big deal with a firm in Tokyo, Bucharest or Manila, for example, a trip before signing would be  a wise move.

There’s no better way to understand the investment you’re going to make, than to see it firsthand.

If traveling to another country or around the world is out of the question, consider the services of a trained private investigator who can utilize local resources, assets and field investigators on the ground where you need them.  Prior to consulting with a professional, it’s a good idea to do some research on your own, and you can do this by checking references, making phone calls, and searching the web.

Once you’ve done your research, you’ll be better prepared to speak with a professional investigator and discuss your case, and the evidence and information you’d like to obtain and verify.

Check with local government authorities in the country in question

If you can’t afford an investigation, and you’ve done all the possible research you can, and you’ve checked references, and even visited the company in question, you might consider checking with local government agencies where the company is based or operates.  This can be easier said than done, however, if you don’t speak the language or if the foreign office doesn’t respond to your inquiries.

Investigators check with local government agencies in the country in question to make sure the entity is registered, legal, and has no history of fraud, litigation or court cases on the owners or entity itself.

In certain developed countries, you might even be able to check business registration records online, as with the Australian business registrar, for example.  Of course, it’s easy to register a business, so remember business registration is only one of many verifications that should be conducted.

Be leery of too-low prices and payment methods

Lots of times companies that are conducting a scam operation might try to entice new victims with really low prices, hoping they’ll attract people looking for an incredible deal. In this case, the old adage that “if it sounds too good to be true, it probably is” holds a lot of water.  And, there is no free lunch!  In most cases, you get what you pay for, so be skeptical of great offers or investments with super low prices.

Although countries in high risk zones are the greatest threat, no country is immune from fraud.

In the investigation business, there is no professional investigator who will take a case for less than a few hundred dollars.  Real investigation requires time, money and training.  Fair prices are the norm, and anything out of the norm requires a closer look.  This is true in any industry, whether it be a gold miner in West Africa, a shipping company in China, factory in India, or an outsourcing provider.

If a company or individual overseas is requesting payment be made in advance, and that payment should be made via bank wire or Western Union, be careful!  Once money is sent via these methods, it is nearly impossible to retrieve. Verify and investigate the company first, then review the options.

Keep these tips in mind when performing due diligence.  If possible, reach out and hire an expert for a company verification, which may include getting information on assets and much more.

C. Wright
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