Due Diligence
Due diligence generally refers to the care a reasonable person should take before entering into an agreement or a transaction with another party. It typically involves an investigation or audit of a potential investment and serves to confirm all material facts in regards to a sale or investment. Offers to purchase an asset are usually dependent on the results of due diligence analysis. This includes reviewing all legal and financial records plus anything else deemed material to the sale. It is generally advised that sellers perform a due diligence analysis of the buyer to determine the buyer's ability to purchase, as well as other items that would affect the purchased entity or the seller after the sale has been completed.
Know Your Customer (KYC)
In the wake of the September 11th, a new form of due diligence has appeared on the horizon. Know Your Customer (KYC) is the due diligence and bank regulation that financial institutions and other regulated companies must perform to identify their clients and ascertain relevant information pertinent to doing financial business with them. Typically, KYC is a policy implemented to conform to a customer identification program mandated under the Bank Secrecy Act and USA PATRIOT Act. Know your customer policies have becoming increasingly important globally to prevent identity theft fraud, money laundering and terrorist financing. In a simple form these rules may equate to answering twelve questions, but this is the tip of the iceberg and regulators now expect much more. KYC should not be thought of as a format to be filled - it is a process to be undergone from the start of a customer relationship to the end.
One aspect of KYC checking is to verify that the customer is not on any list of known fraudsters, terrorists or money launderers, such as the Office of Foreign Assets Control's Specially Designated Nationals list. This list contains thousands of entries that is updated at least monthly. As well as sanctions lists there are lists of third party vendors that track links between persons regarded as high-risk owing to negative reports in the media about them or in public records. Beyond name matching, a key aspect of KYC controls is to monitor transactions of a customer against their recorded profile, history on the customers account(s) and with peers.
Know Your Customer processes are also employed by regular companies of all sizes, for the purpose of ensuring their proposed agents, consultants or distributors' anti-bribery compliance. Banks, insurers and export credit agencies are increasingly demanding that customers provide detailed anti-corruption due diligence information, to verify their probity and integrity.
How We Serve Our Clients
Our resourceful and dynamic attorneys are adept in performing due diligence for our business clientele. With the growing threat of indentity theft, business scams and fraud in this global economy, our thorough and in depth investigation of your target acquisition and potential business partners gives you added assurance for the future success of the business enterprise. Thus, we are often called upon in large-scale transaction, international joint ventures, and overseas strategic alliances to perform due diligence early on in the negotiation stages to protect our client's vital and often vunerable business interests.
