INVESTMENT Fraud Investigation

Investment Asset Search, Due Diligence and Investigation

Our investigators have successfully located assets totaling more than $1.2 billion. We have coordinated past investigations with the Securities and Exchange Commission (SEC) and Federal Bureau of Investigation (FBI), as well as state and foreign securities regulators. Every investigation is led by a Certified Fraud Examiner.

Case Study: Assisting Victims of a Global Fraud

The well-publicized collapse of an international Ponzi scheme resulted in the prosecution and conviction of its principal founder, whose failed investment firm was placed into federal receivership.

Our investigators worked on behalf of the receiver to trace the flow of fraudulent conveyances and identify recoverable assets, including many millions that had been transferred to former employees and family members.

These assets included substantial holdings in real property, bank accounts, brokerage accounts, personal trusts, family inheritances, insurance policies, company retirement plans and corporate interests.

After court-ordered attachment and execution of assets by the receiver, proceeds from the recovery were distributed to victims of the investment fraud.

Find Funds and Freeze Assets

Perpetrators of financial fraud are often skilled at playing curious and complicated games with money. They may fabricate financial statements, create accounts under other names, or move funds to offshore jurisdictions. These maneuvers typically accelerate once the fraudster realizes their scheme is under threat of exposure or collapse.

Fraud victims who are pursuing litigation can petition the court early in the proceedings for an order that temporarily prevents the other party from transferring, dissipating or disposing of its assets. These options include prejudgment writs of attachment, preliminary injunctions and temporary restraining orders. Following the conclusion of a lawsuit, frozen assets can be claimed by the prevailing party upon entry of a judgment for money damages.

Yet before accounts can be frozen or garnished, they must first be identified. An asset search by a professional investigator can identify an extensive range of personal financial holdings.

Financial Recovery from Fraudulent Schemes

For victims of fraud, one of the most important steps toward recovery – often a matter of great urgency – is figuring out where the money went, before it disappears forever.

The areas of a comprehensive asset investigation of an individual may include:

• Bank, Brokerage, Investment, Retirement and Mutual Fund Accounts

• Real Property, Motor Vehicles, Aircraft, Boats

• Employment, Business Interests and Special-Purpose Entities

• Personal and Family Trusts

• Fraudulent Transfers of Property to Family and Associates

Asset searches for fraud claims are also conducted on companies. Asset investigation of business and commercial entities may cover the following areas:

• Business Bank Accounts

• IRS-Registered Company Benefit, Pension, Retirement and Profit-Sharing Plans

• Real Property – Commercial, Agricultural and Investment Properties

• Fleet Vehicles, Financed Equipment, Aircraft and Other Tangible Assets

• Corporate Credit Profile

• Identification of Principals, Corporate Parent, Subsidiaries, and Affiliates

All asset searches are conducted in compliance with the Fair Credit Reporting Act (FCRA) and Gramm-Leach-Bliley Act (GLBA) financial privacy laws.

Investor Due Diligence

Investors are advised to conduct due diligence on potential investment opportunities before making a commitment of capital. We prepare detailed financial dossiers on parties involved in potential deals, so investors can make informed decisions based on confirmed facts and figures.

The general objectives of pre-deal investigations are to determine if an investment opportunity is legitimate and viable, and confirm whether the terms, promoters and financial prospects of the deal have been accurately represented.

The specific scope of a pre-investment investigation depends on the nature of the deal and the players involved. It can include the following areas of investigation: 

• Verification of Capital, Collateral and Financial Accounts

• Review of Securities Filings, Public Offerings and Private Placements

• Professional Profiles of Broker-Dealer and Investment Advisor

• Confirmation of Business Operations and Corporate Status

• Litigation, Bankruptcies, Liens, Judgments

Investigations in support of investor decision-making consist of two main areas of investigation: asset verification and background investigation.

Verification of existing assets is necessary to determine if the proposed deal is financially viable. Asset verification also allows an informed assessment as to whether the opportunity and its associated risks have been accurately portrayed in the prospectus and related materials.

Vetting the background of the key people who put together the deal is equally critical. Their track record can be a strong predictor of future performance. It is better to know sooner, not later, whether a potential partner’s history is characterized by criminal charges, fraud claims, investor complaints, insolvency or regulatory enforcement actions.

For M&A transactions and major corporate investments, the bulk of pre-deal due diligence is typically handled by attorneys, accountants and third-party ‘clean teams’ who review the company books and related documents. In certain cases, these materials may be voluminous. Yet a deluge of data does not always signify full disclosure. Critical details may be incomplete, scrubbed or sanitized. If investors are left with unanswered questions about the financial status of an acquisition target, they may seek an independent assessment and discreet investigation.

Consult an Investigator

If you would like to discuss an asset search for investor due diligence, fraud claims or related matters, please complete the form below. You can also speak with an investigator by contacting our offices at 800-580-8755.