The Role of Due Diligence in Hiring and Vendor Selection

The Role of Due Diligence in Hiring and Vendor Selection

The Role of Due Diligence in Hiring and Vendor Selection

Every decision carries a potential consequence. This statement is true even for organizations, and they have to be cautious in every process that constitutes operations. In today’s dynamic business landscape, digital technology is advancing, and businesses must take care of the risk inherent to hiring and vendor selection. To embrace diversity, enterprises are appreciating the role of cultural amalgamation, attracting people of different characters, skills and qualifications. This is where due diligence acts as a shield against unforeseen risks.

Risk management is elemental for organizations that want to progress in the evolving market environment. As such, the best way to lessen risks is to start from the bottom- understanding the nature of employees and vendors before they become part of your organization. We unveil the power of due diligence and why a human resource director should embrace it.

Understanding Due Diligence

Due diligence involves in-depth research and investigation, usually conducted by an organization, before agreeing with an employee or vendor. This is the most crucial stage for every organization, as it determines the efficiency of the contract entered into. This process is detailed and entails gathering information, analyzing the data, interpreting it, and verifying the information presented. As lengthy as it may appear, this is a very instrumental chain, as it guides informed decision-making, mitigating the risks. By conducting due diligence, parties’ interests and any problem that can be experienced in the future are protected.

The Imperative of Due Diligence in Hiring

Why, then, is it essential to conduct due diligence in hiring? Statistics reveal that bad hires are a cost for any business. Society for Human Resource Management (SHRM) noted that bad hires constitute about five times the position’s annual salary. This is mind-blowing to any human resource director tasked with ensuring the workforce is skilled enough to benefit the company. Through due diligence, it would be easier to mitigate the risk of bad hires. This cost is incurred in recruitment, training, lost productivity, and legal fees.

Also, conducting due diligence in hiring ensures regulatory compliance. It is equally a requirement for human resource directors to ensure that they comply with the employment local laws, regulations, and standards when hiring. We are in an era marked with stringent local rules regarding the employment process, and due diligence has become mandatory. Failing to understand the actual qualifications and credentials of the candidate can expose the company to legal battles and tarnish its reputation. For instance, hiring a candidate with a history of fraud or ethical delinquency in highly regulated industries such as finance and health care attracts fines or license revocation. Lauth’s investigative team can unearth the questionable background of your new hires to cut on this cost.

Leveraging Due Diligence in Vendor Selection

Vendor services involve entrusting part of the business operations to an external entity, making the organization prone to fraud. One essential purpose of due diligence is to safeguard against these fraudulent activities. With a proper background check, an organization can avoid getting into the loop of deceptive vendors, which can compromise the supply chain’s integrity, and thus losing customer trust. A case in point is the Enron Scandal, where the failure of the company to conduct due diligence resulted in huge financial loss. Association with the fraudulent vendor contributed to financial loss and triggered corporate governance reforms globally. A simple step of ensuring you know your vendor can save your organization from such.

The primary duty of a vendor is to support an organization in running smoothly and ensuring efficiency. Due diligence evaluates the vendor’s financial stability and capability to take that role. We live when global economies are uncertain and market fluctuations are evident. Due diligence, therefore, gives an overview of the vendor’s financial health, risk exposure, and solvency to reduce the risk of disrupting the supply chain management.

The Role of Due Diligence in Hiring and Vendor Selection

Best Practices for Effective Due Diligence

Embracing technology is the best way to remain ahead regarding due diligence and get the desired results. It is elemental for your organization to invest in modern technologies, such as the use of artificial intelligence and data analytics, to uncover facts that manual operation cannot. Also, this should be coupled with collaboration and information sharing. Collaborating with peer industries, regulatory bodies, and professional bodies can allow access to databases to learn more about the candidates. One such valuable entity is Lauth, and we pride ourselves on using verified databases to secure a comprehensive background report on the relevant Subjects in the case.

That said, due diligence is not a one-time thing. An organization should implement systems for continuous monitoring. This is because information is not static, and the vendor’s details might change along the way. Thus, it is essential to keep track of records to adapt to evolving risks.


Risk prowls at every corner, and the beacon of assurance that organizations can rely upon is conducting due diligence. Whether during the hiring process or selecting a vendor, due diligence remains the pillar of hope, safeguarding the organization’s reputation and interest. Embracing these due diligence principles and integrating them into decision-making gives an organization the resilience and confidence to navigate turbulent waters. Don’t stress; our investigators have the necessary tool chest to conduct objective, covert undercover operations to unearth misconduct among the hires and vendors.

Workplace Investigations Can Reveal if Previous Personal Crimes Have Been Committed by Your Employees

Workplace Investigations Can Reveal if Previous Personal Crimes Have Been Committed by Your Employees

When it comes to ensuring safety in the workplace, a big puzzle piece comes with being able to claim peace of mind that your employees can be trusted. In this regard, you’ll want to be confident that any potential new recruit doesn’t have anything untoward lurking in their history. This makes uncovering whether they have committed personal crimes in the past a valuable, if not urgent, endeavor.

Many American businesses rely on their in-house HR team or recruitment firms to perform employee background checks. However, turning to skilled corporate investigators for this task can allow a far greater level of illumination, ensuring that any potential employee criminal record doesn’t remain under the radar.

Crucially, a licensed corporate investigations firm can draw from many of the same databases used by law enforcement to build a clear picture of your job applicant or employee’s background, including not only their employment record but also any history of misdemeanors or felonies. Read on as we explore the advantages for employers when in-depth background checks are conducted.

Lifting the Lid With Comprehensive Employee Background Checks

There are countless reasons why employers should be concerned about the caliber of their employee background checks and the potential for historical personal crimes. For example, a hidden history of harassment, violence, theft, or discrimination may spell disaster for an otherwise stable and productive team.

Research suggests that more than half of job applicants lie on their resumes, and while some untruths may be relatively innocent, others could be absolute deal breakers. Proactively framing this statistic further is the fact that, as an employer, you are far from powerless.

Certain types of dishonesty on a resume or job application can be considered fraud and, in the case of employees who have been hired based on false information, your business may be entitled to financial compensation. This makes comprehensive employee background checks a solid investment from multiple perspectives.

Corporate Investigators Can Safeguard Your Employees and Business

From background checks to cases of corporate fraud, any investigation conducted within or to better protect the workplace is subject to a range of legislation and regulations. A seasoned corporate investigations firm will be able to guide you through these processes, ensuring that every ‘t’ is crossed and ‘i’ dotted when it comes to following the letter of the law.

Our expert investigators will not only ensure that no stone remains unturned when it comes to gathering essential information about your prospective or current employees, but also thoroughly document every aspect of their process and findings, providing a firm foundation of support for any necessary follow-up.

As professionals working within the corporate sphere, they will also maintain absolute discretion and confidence, protecting both internal and public perception of your brand at every turn. So, would you like to learn more about the services provided here at Lauth Investigations International? Visit our Corporate Background Checks page or reach out to our corporate investigators today for a no-obligation chat about your needs.

The Crucial Role of Private Investigators in Fact-Finding for Promissory Estoppel Investigations

The Crucial Role of Private Investigators in Fact-Finding for Promissory Estoppel Investigations

Promissory Estoppel

When it comes to business agreements and contracts, it is essential for corporations to gather all available information to support their case when allegations of failure to meet terms arise. Promissory estoppel, a legal doctrine that prevents a party from reneging on a promise, often plays a significant role in such disputes. In these complex situations, a private investigator can be a valuable asset, offering a range of services to help uncover essential facts, gather evidence, and strengthen a corporation’s case. This article explores the critical role of private investigators in fact-finding during investigations involving promissory estoppel, emphasizing their contributions in building robust cases for corporations.

Uncovering Hidden Information in Promissory Estoppel

Private investigators are skilled in conducting thorough investigations, utilizing various techniques to uncover hidden information that may be crucial in a promissory estoppel case. By employing surveillance, background checks, and other investigative methods, private investigators can identify and locate relevant individuals, witnesses, or potential evidence. This information can shed light on the intentions, actions, and credibility of parties involved in the agreement, helping corporations build a stronger case.

Gathering Witness Testimony

In promissory estoppel cases, witness testimony can be invaluable in establishing the validity of a promise, reliance by the injured party, and the extent of damages suffered. Private investigators have the expertise to locate and interview potential witnesses discreetly. They can elicit detailed and reliable statements that provide insights into the circumstances surrounding the promise, subsequent actions, and the impact on the injured party. These testimonies become crucial evidence that can significantly strengthen a corporation’s case.

Promissory Estoppel Document Retrieval and Analysis

Promissory estoppel investigations often require thorough examination of documents, such as emails, correspondence, contracts, and financial records. Private investigators possess the skills and resources to retrieve and analyze these documents effectively. They can scrutinize the terms of the agreement, establish timelines, identify inconsistencies or breaches, and evaluate the impact on the injured party. These findings help corporations build a comprehensive narrative and support their claims with compelling evidence.

Surveillance and Monitoring

In certain instances, surveillance may be necessary to gather evidence in a promissory estoppel investigation. Private investigators are experienced in conducting discreet surveillance operations to monitor the activities of individuals involved in the agreement. By capturing visual evidence or documenting suspicious behavior, they can provide valuable insights into whether the terms of the agreement were met, and whether the injured party suffered damages as a result. This evidence can play a crucial role in bolstering a corporation’s case.

Expert Testimony and Consultation

In addition to their investigative skills, private investigators can also provide expert testimony and consultation in promissory estoppel cases. Their extensive knowledge of investigative procedures, legal requirements, and industry practices allows them to offer valuable insights and guidance to legal teams. Private investigators can help attorneys understand the complexities of the case, interpret the evidence gathered, and provide strategic advice on presenting a compelling argument in court.

Hire a PI Today

In investigations involving promissory estoppel and potential failure to meet terms of a business agreement, private investigators can be an invaluable asset to corporations seeking all available information to build a robust case. Through their expertise in uncovering hidden information, gathering witness testimony, retrieving and analyzing documents, conducting surveillance, and providing expert consultation, private investigators enhance a corporation’s ability to present compelling evidence and establish the validity of their claims. By leveraging the skills of private investigators, corporations can navigate complex legal scenarios with confidence, ensuring that justice is served and contractual obligations are upheld.

What is a Lifestyle Investigation?

What is a Lifestyle Investigation?

In the corporate world, it’s essential for businesses to have a comprehensive understanding of their key personnel, from foremen and managers to executives and board members. This is where lifestyle investigations come into play. A lifestyle investigation is a thorough examination of an individual’s personal and professional life to provide a holistic view of their background, behaviors, and potential risks. When leadership has all the facts regarding their personnel, they can make crucial decisions that will affect the overall health and well-being of their company.

Understanding Lifestyle Investigations

A lifestyle investigation is a specialized form of due diligence that goes beyond basic background checks. It involves an in-depth examination of an individual’s lifestyle, personal habits, financial history, social connections, and reputation. The purpose is to identify any red flags, potential conflicts of interest, or hidden risks that could impact the individual’s role within the corporation. While many private citizens may wish to initiate a lifestyle investigation into a prospective in-home employee, contractor, or assess the judgement of a potential caretaker, the applications of lifestyle investigations in the corporate sector can improve every aspect of an operation from top to bottom.

Steps in a Lifestyle Investigation:

  • Research and Gathering Information: The first step in a lifestyle investigation is to gather relevant information about the individual. This includes public records, financial disclosures, social media profiles, and any other publicly available data. Private investigators often utilize their expertise to access databases and resources not readily accessible to the general public.
  • Interviews and Source Verification: Private investigators conduct interviews with associates, colleagues, and acquaintances to gather insights into the individual’s reputation, work ethic, and lifestyle choices. This step involves careful verification of sources to ensure the information collected is reliable and accurate.
  • Financial Analysis: Examining an individual’s financial history, including assets, liabilities, and financial transactions, can provide insights into their financial stability, potential conflicts of interest, and overall integrity.
  • Social Media Analysis: A thorough analysis of an individual’s online presence can uncover valuable information about their personal life, associations, interests, and potential risk factors. It can help assess their suitability for key roles within the corporation.
  • Reporting and Risk Assessment: The final step involves compiling the gathered information into a comprehensive report. This report outlines any potential risks, conflicts of interest, or undisclosed information that could impact the individual’s role within the corporation. It provides the organization with a clear picture to make informed decisions about their personnel.

Benefits for Corporations

Risk Mitigation: Lifestyle investigations help corporations identify potential risks before they become detrimental to the company’s reputation or financial stability. By uncovering any undisclosed information, conflicts of interest, or unethical behaviors, corporations can take proactive measures to mitigate these risks.

Protecting the Corporate Culture: By thoroughly vetting key personnel, corporations can ensure that their leaders and decision-makers align with the organization’s values and ethical standards. This protects the corporate culture and reduces the chances of internal conflicts or reputational damage.

Preserving Stakeholder Trust: Stakeholders, including investors, customers, and business partners, place their trust in the corporation and its leadership. Conducting lifestyle investigations demonstrates the commitment to transparency and due diligence, enhancing stakeholder confidence and preserving trust.

Legal and Regulatory Compliance: Certain industries have strict compliance requirements, and lifestyle investigations can help corporations fulfill these obligations. By identifying any potential conflicts of interest or illegal activities, organizations can ensure compliance with laws and regulations.

Lifestyle investigations are a powerful tool for corporations seeking a complete understanding of their top-level employees. By delving beyond standard background checks, these investigations provide insights into an individual’s personal and professional life, helping businesses make informed decisions and mitigate potential risks. From protecting the corporate culture to maintaining stakeholder trust, lifestyle investigations contribute to the overall integrity and success of a corporation.

Reducing Internal Theft with Comprehensive Background Checks

Reducing Internal Theft with Comprehensive Background Checks

We all like to think that we’re a good judge of character, but when it comes to choosing who to trust with your company’s inventory, intellectual property, and assets, it is always wise to defer to the facts. Today, we live in a world where 90% of all significant thefts from businesses are internal, and almost a third of businesses bankruptcies are triggered by the very same issue. This makes lifting the curtain on your next applicant’s true credentials key to stopping internal theft. 

Yes, in such troubled times, it is high-risk behavior to assume that every resume is honest or that every employee is as clean and crease-free as their pressed work attire. Instead, the best tactic is to up your background-check-game and ensure that you catch any and all rotten candidates before they step into the first day of onboarding. For that, you’ll need the right collaborator, so let’s explore what makes some background checks more comprehensive than others and how that difference dictates their effectiveness for stopping internal theft in its tracks.

Outsourced Background Checks Can Be a Smart Investment

Employee screening is something that tends to happen on a sliding scale of seriousness. At its most basic level, your HR team may diligently check the references of employment candidates, however these can easily be faked. When dialing the number on an applicant’s resume, there’s no way of knowing that you’ll find their true past employer on the other end of the line.

The next step that a company might take is requesting a criminal record check on would-be trainees. This is an excellent idea as it can reveal if a questionable past lies between the letters of their application. However, this still means only piecing together small segments of that individuals character and track record. To really grant a clean bill of health to any applicant status, the best option is to turn to a corporate investigator who is equipped to efficiently present a complete composition—the full sense of who this person is and whether they will fit on your team, or pose a worrying threat.

So what might a background check from Lauth Investigations International tell you? Well, our investigators are licensed to access the same verified databases used by law enforcement. This allows up to compile an intelligence report on your candidate, presenting a full and contextual history of the subject as it relates to their potential role in your enterprise. Pertinent paths of exploration might include confirming the validity of their employment record and credentials; uncovering criminal, financial, and litigative history; and joining the dots between the various pieces to ensure that each element adds up.

Stopping Internal Theft Before It Starts

As each new employee is welcomed into your team, with them comes a distinct vulnerability to a diversity of theft types. Undoubtedly, stopping internal theft doesn’t only mean preventing inventory or office supplies from drifting away. It also means safeguarding against financial theft, embezzlement, fraud, data theft, intellectual property theft, and more. To put the scale of this threat in context, we can turn to research from the U.S. Department of Commerce, which tells us that American businesses lose roughly $50 billion each year as a result of employee theft—and that this number is rising by 15% annually.

Avoiding becoming a part of these alarming statistic begins foundationally with background checks. It is always better to prevent the kinds of disastrous disappearances that can undermine your operation than it is to launch into post-crisis damage control. And by developing a dependable collaborative relationship with a corporate investigations firm—one that understands your business and is always ready to provide dynamic support—you can dramatically reduce the risk of internal theft on an ongoing basis and act quickly if the unexpected occurs.
Without a doubt, comprehensive background checks are a powerful tool for stopping internal theft before it gets the chance to start. Health-checking your company’s culture with a Corporate Culture Audit is also a highly effective way to reveal risk before it evolves into criminal behavior in the work place. To discuss these services and more with a member of our team, reach out for a no-obligation consultation today—because we know that every unique business calls for unique solutions, so let us help guide you towards yours.

How to Equip Your HR Members to Potentially Weed Out Bad Recruitment

How to Equip Your HR Members to Potentially Weed Out Bad Recruitment

Think the humble employee background check is an unnecessary expense? Think again. Because there’s nothing like a spate of bad hires to leave a gaping hole in the finances of your business. With research placing the average cost of a single bad recruitment choice anywhere from $17,000 to $240,000, every organization should have weeding out flaws in their HR department’s strategy high on the agenda. 

Poor recruitment practices can be a drain on morale and company culture, wasting time and money and placing a heavy burden on the shoulders of those forced to take up the slack. So what can Human Resources do to mitigate this potential disaster? From background screening to watching for red flags, today we’ll dive into how your HR team can streamline their recruitment process and protect your bottom line

The Warning Signs of a Recruit You’ll Regret

A great candidate CV has landed on the desk of your top HR manager, and they’re excited at the prospect of having this individual on board. All the desired competencies and experiences appear to be in place, but there’s no escaping the fact that a CV can be doctored to hide a disastrous history or terrible work ethic.

In support of background screening—which we’ll come back to later—the interview process provides a key opportunity to observe candidates and be on the look out for obvious red flags such as showing up late or poor presentation, but you can leverage this time together even more effectively. Be sure to question candidates thoroughly on the contents of their credentials, experience record, and application to ensure that every detail adds up.

Make Sure the Right Cards Are on the Table

You’ve ensured that the job description posted fully reflects the position offered and that the candidate comprehends every aspect of the role. Now is the time to lay all the pertinent cards on the table, letting them know your expectations and making sure that you understand theirs.

This can include going over the standards that you require from employees—in terms of conduct, responsibilities, team engagement, and appearance—and ensuring that they intend to be with you for the long haul. Far too many employers invest substantially in new recruits, not realizing that they only view the position as a stepping stone. There can be no mincing words when ensuring that everyone is on the same page.

Turn to a Trusted Investigations Firm for Comprehensive Background Screening

Any savvy recruiter understands the importance of verifying references and credentials when hiring a new team member. Unfortunately, bad actors in the recruit pool may go to great lengths to deceive, faking vital certifications or enlisting the help of nefarious friends to provide false references.

Your HR team may do their best to conduct a thorough employee background check, but only a licenced investigative firm like Lauth Investigations International will be able to run your potential recruits against the same databases used by law enforcement agencies, or check storied histories that require gathering information across state lines.

When it comes to weeding out bad recruitment, anything less than comprehensive background checks carried out by licenced investigators is a risk that could mean trouble in the making. If you’d like to learn more about how we can support your business in its strides towards greater prosperity, contact our team today.