Business Investigations
Protection of Assets and Brand Reputation
Inventory Losses and Disability Fraud
Unexplained inventory shrinkage and employee fraud can destroy your company.
A survey of fraud examiners in 2016 by the Association of Certified Fraud Examiners revealed that U.S. businesses lose approximately five percent of their revenue each year to various forms of occupational fraud. According to the 2016 Report to the Nations, the median loss for all cases reported was $150,000, and over 20% of those cases involved losses of $1 million or more. Occupational fraud covers not only employee theft and fraudulent or exaggerated disability claims, but can include product diverted from its main wholesale or retail supply chain. While most disability and Workers’ Compensation claims are legitimate, studies show that up to two percent or more of all workers’ comp claims are fraudulent. Over an extended period, those losses impact a company’s bottom line in lost sales, inventory replacements, increased insurance premiums and other human resource expenses.
Trace Investigations can assist your business by:
Investigating suspicions of inventory losses due to employee theft.
Investigating diversion of product from wholesale or retail supply chains.
Investigating employees suspected of workers’ comp and disability fraud.
Providing forensic examinations of company cell phones and tablets for unauthorized intrusions, spyware and malware.
Investigating sub-contractor and vendor frauds and deceptions.
The benefits of employee theft, disability and other fraud investigations:
Inventory Losses Explained: Employee theft is verified and controlled, either in-house or through civil or criminal prosecutions.
Product Diversions Stopped: Product diversion from the normal wholesale or retail chain is eliminated.
Business Costs Controlled: Insurance premium increases and other added expenses can be mitigated or eliminated, impacting the bottom line upward.
Business Relationships Honored: Standards of care expected by insurers and other providers, business partners and stakeholders are met.
Due Diligence Investigations
Avoid a bad business or investment decision.
Business relationships entered into too quickly can lead to fraud and other losses. Before entering into any new business arrangement, such as a merger or acquisition, a due diligence investigation is required.
“The goal of any due diligence investigation is to avoid a bad business or investment decision.” This quote is from Trace Investigations founder Don C. Johnson, Certified Legal Investigator™ in the reference text Corporate Investigations, published by Lawyers & Judges Publishing Company, Inc., 2002 edition. Johnson authored Chapter 11, “The Due Diligence Investigation,” which still serves as a manual for conducting an investigative due diligence. At the time, studies illustrated that the U.S. economy lost billions of dollars annually to various business frauds and economic crimes. Those losses have only continued to climb and, as Johnson noted then, “Economic crime is in itself a growth industry …” Any business owner or corporation board of directors considering a business merger or acquisition is duty bound to conduct a due diligence investigation on that proposed transaction.
Trace Investigations can assist your business by:
Investigating the principals of merger and acquisition targets.
Researching relevant markets and industry sources.
Investigating past performance and history of the targeted company.
Conducting field investigations to verify or obtain information.
The benefits of a due diligence investigation:
Ability to Eradicate: A client is reassured on a strategy or alerted to its problem.
Acquisition Assurance: Standards of care in normal business transactions are met.
Compliance Satisfaction: Duties under controlling law and regulatory compliance issues are satisfied.
Continued Profits Assured: Future business and economic losses are prevented.
Intellectual Property Investigations
Counterfeiting and trademark infringement can destroy your brand’s value.
The National Crime Prevention Council reports on its website that counterfeiting and intellectual property piracy cost the U.S. economy more than $250 billion in lost revenue, and, according to one estimate, we lose 750,000 jobs every year due to these crimes. There are two general categories of intellectual property: copyrighted materials, such as books, films and other artistic works; and industrial property, such as trademarks, service marks, patents and designs. International manufacturers of designer goods are obviously concerned about protecting their brands, considering the extent of counterfeit products that travel across international borders to various wholesale and retail outlets. Smaller businesses and manufacturers should be equally concerned about the marks and designs that distinguish their products or services.
Trace Investigations provides intellectual property services by:
Investigating reports of counterfeit goods in secondary retail outlets.
Effecting the surrender, storing and destroying of counterfeit goods.
Investigating trademark infringements and copyright violations.
Providing forensic examination of company cellular and tablet devices to establish collusion.
Identifying and investigating litigation targets.
The benefits of an investigation:
Brand Protection: A brand is a business’ identity. We investigate attacks on your brand.
Counterfeit Elimination: Counterfeit product is destroyed and purveyors are identified and further trademark dilution is prevented.
Product Diversions Stopped: Product diversion from the normal wholesale or retail chain is eliminated.
Cost Recovered: Litigation costs can be recovered.
FAQs
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We are referring to any investigation for a business owner, whether a sole proprietor or corporation manager or executive, that relates to protecting the assets of the business. We conduct loss prevention assignments, whether they require an undercover operative in the workplace or surveillance of a sales representative. We are seeing more assignments in intellectual property investigations, such as counterfeit products in secondary retail markets, trademark infringements and software piracy. We also provide investigative services to companies that are self-insured, on a Workers’ Compensation claim that appears suspicious, for example. For small business owners, we often assist in collateral recovery and judgment enforcement, such as skip tracing and asset investigations.
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An asset investigation is the search for the property and other holdings of a judgment debtor or a subject in anticipation of litigation. An asset investigation can be limited to a search for unencumbered real estate and personal property, such as boats, airplanes, motor vehicles, collectibles, etc. A more extensive asset investigation involves a search for bank accounts, which are conducted in compliance with all applicable laws, such as the Graham Leach Bliley Act.
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Yes. As our founder Don C. Johnson, CLI, CII wrote in the reference text, Corporate Investigations, “Modern due diligence … includes many day to day management operations and decisions in national and international commercial transactions, including mergers and acquisitions.” (1) As our markets have expanded nationally and globally so have the opportunities for business frauds and other economic crimes. Before considering a business merger or acquisition, a business owner has a responsibility to conduct a due diligence investigation, not only to protect himself or herself from making a bad business decision but to ensure compliance with standards of care inherent in a business transaction where shareholders are involved.
(1) Corporate Investigations, Compiled by Reginald J. Montgomery, CLI,CFE and William J. Majeski, published by Lawyers & Judges Publishing Company, Inc., 2002; page304. Johnson authored Chapter 11, “The Due Diligence Investigation.” -
Yes, to the extent allowed by law and circumstance. At the federal level, background screening is controlled by the provisions of the Fair Credit Reporting Act, which requires, in part, that the consumer (the job applicant) sign a notice and authorization form. However, many due diligence investigations can be conducted sub-rosa, as long as legal and permissible purposes are recognized. Higher levels of a corporate investigation may require that certain individuals be contacted for interviews, which may impact confidentiality controls.
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Fees vary. Just as there are various kinds of business investigations, there are different levels of fees and expenses. For pre-employment screening, for example, we can tailor a package that meets the business owner’s needs and provides a unit cost on screening elements. On a due diligence case, once the parameters of the investigation have been identified, we provide the client with an estimate on the fee and set the budget accordingly. If you have a business concern that needs investigating, contact us right away; we do not charge for an initial consultation.
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We accept Visa, MasterCard, American Express, PayPal and checks.
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You can always call our office from 9 am to 5 pm, Monday through Friday (phone 812-334-8857). Our investigators have cell phone numbers and email addresses printed on their business cards and often communicate directly with clients during cases. You can also go to our contact page and send us a message. If you have a legal matter you think an investigator can help you with, we want to hear from you.
Get in Touch
For assistance, please email use the contact form and we will get back to you within 24 hours. For immediate assistance, please call us at 812-334-8857.
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