(What’s it like on the front line supporting the firm’s clients?  What are the challenges the firm’s experts help senior business executives, general counsel, board members and other decision-makers address?  Welcome to ACTION WEDNESDAY.  Every Wednesday, the Front Line Blog publishes a new case study.)

Client’s Challenge

The call was from the HR leader of a U.S.-based, NASDAQ-traded international energy and mining company with operations in Mongolia and Turkey, as well as Guyana and West Africa. “Would Hillard Heintze conduct,” she asked, “strategic background investigations on two individuals working in our Guyana-based extraction operations?” One was a British citizen. The other was Malaysian. Both subjects had lived for extensive periods in foreign jurisdictions.

The Hillard Heintze Solution

The preliminary investigation did not identify any criminal records naming either individual in U.S. jurisdictions or in their native countries.  Most background investigation service providers would have stopped at that point – because that finding satisfied the contract requirement. But we had identified two civil matters naming the first individual – a divorce in California and a recent personal injury suit in the U.K., apparently stemming from the individual’s time in Mongolia. We obtained a copy of the file and reviewed the suit. We conducted source inquiries regarding both individuals in Mongolia, Kazakhstan and Turkey and on one of the individuals in Malaysia. We also conducted local-language media searches for references to our subjects in Mongolia. Key to the investigation was the fact that we didn’t rely on computer courthouse records which erroneously identified the lawsuit as a “personal injury” case.  Instead, by requesting and reading the file, we quickly recognized that the court had mistakenly categorized the matter and that it was, in fact, a sexual harassment case. That was a crucial discovery because it provided a telling window into the predilections of a manager with an impeccable professional profile – and a personal track record that could create significant legal, compliance, risk management and operational challenges for the client.

Impact on the Client’s Business

This finding changed everything for the client. The results of this investigation helped the client better understand the personal and professional qualities of key individuals the company was considering for two critical and sensitive positions – and helped it avoid certain financial and operational risks at the site, country and regional levels.

Unplugged: The Project Manager’s Perspective

“This investigation spanned quite a few countries where these individuals had lived, worked and travelled over the past twenty years.  We followed the leads wherever they took us. Naturally, we initiated pro-forma inquiries in the various countries of citizenship, employment and residence.   But it would have been impossible to wend our way through the web of international leads that surfaced without tapping our team’s international sources, relationships and intelligence networks.”

The ACTION WEDNESDAY Tool Box:  Three Key Take-Aways

Establish a Relationship with an Investigative Advisor – Before You Actually Need One: If you need detailed insights into an individual or corporation’s activities in the international arena, don’t wait until the last minute to start looking for a qualified firm.  There are many, just-check-the-box firms in this market.  And if make a hurried, deadline-driven decision, you may well end up with one.

If Time is Tight, Pick a Proven Firm with Extensive Resources and an Established Track Record – It’s not always clear where a strategic background investigation and due diligence inquiry will lead.  And if the trail steps off the beaten path – say, in Mongolia or Turkey, in this case, you don’t want this to be the first time your firm has initiated an investigation in the region.

Define the Scope of Work Carefully – But Be Ready to Consider Giving the Investigative Team a Bit More Rope If They Request It – This case study is a great example.  The first 80% of the work satisfied the contract and would have yielded a clean investigative report.  And the second 20% turned the report – and the company’s anticipated plans – on their head.  It cost the client a bit more in investigative fees, but it saved the company potential business impacts that could have been substantial.

 

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