Knowledge is Power

I recently wrote about the first crucial background check to conduct during a due diligence investigation – professional licenses and education –which is often overlooked when contemplating a new business venture and/or partner. Today my post will focus on another important check that is also frequently omitted.

Part II - Public Records

Step two in any kind of background or due diligence investigation is conducting public record searches; easily disregarded yet highly informative. Many overlook the importance of public records perhaps due to the nature of the name itself, what important or illuminating evidence can be found in a public record since it's already public information? Interestingly, public records are easiest to obtain in the United States. Other countries for instance, Germany, do not provide an option to verify if an individual was involved in any litigation. Instead, they must rely on whether the matter was reported to the media. Public records include civil and criminal litigation as well as any bankruptcies, liens, judgments, or uniform commercial code filings.

Although criminal records would at first appear to be the most damning finding, many overlook the little gems that can be found in civil records.

So what can be identified?

Depending on the specific state within the United States, divorce proceedings may be publicly disclosed information. Any adversarial divorce proceedings that can be obtained contain all sorts of interesting facts regarding the individual's personal life, habits, and employment, among other things.

Other interesting facts can be found by looking through civil and bankruptcy proceedings. Examine the subject’s stance; are they litigious or a defendant in too much litigation? Public records help us see the bigger picture and understand a lot more about an individual.

All of these relatively small details are quite valuable prior to forming any kind of partnership or agreement. Knowledge is power; knowing exactly who and what you are facing or have the proper elements to decline a partnership is invaluable.  

As important as it is to verify public information, it is neither easy nor straight forward – even with the help of the Internet we have today.  Many of us have come across websites that offer to conduct a “comprehensive” investigation on an individual for an attractive low cost. Are those websites as thorough as working with a larger investigation firm?  While the price is alluring, there are several drawbacks to using online services.

The first concern is the issue of name matches in public record searches. Conducting a public records search using an automated system may provide results that are simply a name match. This subtlety will not be disclosed or described in the results of an automated search. Professional investigative firms on the other hand, ensure that the records identified and provided in the report involve the particular subject of inquiry.

Moreover, a public records search cannot be conducted entirely on-line. Although it would certainly simplify the process if this were the case, any service that claims a nationwide criminal or civil record check is available on-line is likely omitting or overseeing some records. There are certain records that can only be found using on-site searches in specific states and counties. Automated searches miss these nuances yet claim to be comprehensive.

Lastly, when engaging with a firm to provide due diligence or background investigative services, make sure they offer a customizable solution to fit your specific investigative needs.  Perhaps there are some things you are already aware of or would like to investigate further. Put simply, automated public record searches lack the essential personal touch. Also lacking is organizing and presenting the information in an easily digestible manner. A reputable and experienced outside firm will sift through and research public records and provide a report that is quickly and efficiently understood.