Tag Archive: due diligence

1. Can you spot a wolf in sheep clothing?

   July 10, 2019 11:02 pm Leave a Comment

   Due diligence – If something doesn’t feel right, act on it

   Recently we were instructed to investigate the matter of an unpaid, £25k account. Something didn’t feel right about the claim, right from the start.

    

   Our investigation showed a complicated trail of untruths and fraud. Including fake websites, identity fraud and hacked emails. We immediately advised the client to call in whatever guarantees they held but the prognosis wasn’t good.

    

   This isn’t the outcome we want for any of our clients. So, following this costly and inconvenient process, we have been able to educate our client on how to strengthen their processes.  Central to their improvements was incorporating simple but effective ‘due diligence’ checks. These checks provide business owners with a greater volume of business and financial information about their potential clients. Which will then aid them in deciding who they deal with next time.

   

    

   Don’t be worried to ask for client details. Like many things in business, its the way you ask. Having processes like this in place is professional and should provide client reassurance.

    

    

    

   1.Treat every customer as a potential debtor !

   2.Have an account opening form. Make sure you know who you’re dealing with.

   3.Compare and contrast paperwork e.g. purchase orderhttps://www.thegazette.co.uk/s -Is everything as it seems?

    

   Useful Resources

   • Companies House – Search for information about the company & people
   • Check financial/liquidity status – see if any financial concerns raised
   • Websites – Check the clients own site, look at reviews etc
   • Account details – Have a pro-forma to collect client details. If you would like a blank template, email us

   If you have any questions or would like further information on our advice above or using our services please get in touch Contact Details

    

2. Boris or Jeremy, choose your client?

   11:00 pm Leave a Comment

    

   Regular readers know that we advocate checking and double checking all prospective client and supplier data. The more financial information you hold about a contact, the more informed your decision making will be and the more limited your exposure and risk.

    

   The Challenge

    

   Imagine this, two people come to you, promising the earth. You’ve heard of them before but you need to learn more before you can decide who best to side with.

   

    

   For the sake of this example, let’s call one

   Alexander Boris de Pfeffel Johnson (or Boris to his friends) and the other

   Jeremy Richard Streynsham Hunt ! !

    

    

    

   Resources used:

   • Companies House – Search for information about the company & people
   • Check financial/liquidity status – see if any financial concerns raised
   • Websites – Check the clients own site, look at reviews etc
   • Account details – Have a pro-forma to collect client details. If you would like a blank template, email us

    

    

   Simple due diligence shows us

   Boris :

   • Was born in June 1964 and has a known address in London N7.
   • Official records show that Boris has only ever been a director of one company, Finland Station Limited.
   • The company was formed in April 2006 and for the first 11 months was actually known as Blackrock Productions.
   • Boris was a director from the inception of the business but resigned his role in May 2008.
   • The business was subsequently closed down in April 2016.
   • From 2010, the business had only ever filed dormant or small business accounts and as a result, the established trade reference agencies last rated the business as high risk.

    

   From this point, Boris does not appear to have a direct responsibility in any limited company business and so one may question both where his income is derived and his financial strength, key questions to ask when offering goods or services on credit.

    

   Jeremy on the other hand :

    

   • Was born in November 1966 and has a known address in Farnham, Surrey.
   • Records show Jeremy has a history of creating and managing businesses as far back as 1990.
   • The majority of said businesses continue to exist to this day.
   • Perhaps most successful was Hotcourses (Hotcourses Foundation) that was rumoured to have been sold in 2017 for around £30M, netting Jeremy a reported £14M.

    

   Jeremy continues to appear to be listed as a director of the business and although it is believed that his focus may be on other matters, there may be a dividend income to be coupled with his recent investment return.

    

   Conclusion

   In short, had our new client conducted the same simple diligence checks that we encourage all of our contacts and readership to complete, they could have avoided the prospect of a long, drawn out battle for money and power…. Unlike Boris and Jeremy J

    

   If you have any questions or would to know more about our services please get in touch – Contact Us