Asset Searching for Recovery Actions - The Decision Maker’s Critical Tool Part 2

Written by Thomas C. Lawson


In Part One of this article we took a look at some minimum recommendations for asset searches as a recovery medium. This discussion is based onrepparttar assumption that an asset search has already been determined to be sanctionable by, for example, a loan in default, a judgment that has been rendered, a court order obtained forrepparttar 135995 release of credit information in cases that are not clearly defined underrepparttar 135996 FCRA or “extended consent” given in a creditor/debtor or employee - employer relationship.

As Part One suggested, to properly identify a non-corporate subject, fraud examiners in non-law enforcement environments should takerepparttar 135997 following steps:

Obtain credit reports formrepparttar 135998 three major credit bureaus, per FCRA requirements

Obtain social security traces formrepparttar 135999 three major credit bureaus.

Obtain address update/credit report header information fromrepparttar 136000 three major credit bureaus.

Matchrepparttar 136001 information obtained throughrepparttar 136002 independent sources torepparttar 136003 information presented byrepparttar 136004 subject ofrepparttar 136005 asset search.

Part One also provided suggestions for determining assets, including real property ownership, vehicular searches, vessel ownership, aircraft ownership, and banking information. Following is additional financial and business information that should be gathered, as well as liability-related data that impactsrepparttar 136006 subject’s net worth in a recovery action.

Financial Information

Credit reports should be obtained from all major credit bureaus in order to completely determinerepparttar 136007 subject’s credit worthiness or credit status. The Federal Home Loan Mortgage Association (“Fannie-Mae”) determined several years ago that a minimum of three national credit bureau repositories should be accessed to develop credit information prior torepparttar 136008 qualification for a mortgage loan. While this isrepparttar 136009 standard, many companies do not provide this information inrepparttar 136010 pursuit ofrepparttar 136011 asset search, and limit their request to only one major credit bureau. Some difficulty also exists with respect torepparttar 136012 investigative community’s lack of access to major credit bureaus, and many credit reports procured for investigative purposes are, in fact, procured through third- and fourth-party blind sources.

Credit bureau-based research agencies are usually your best source for credit and financial information, as well as banking data, since their primary focus is inrepparttar 136013 credit community and understandingrepparttar 136014 limitations ofrepparttar 136015 credit system, as well as knowledge of “better” access torepparttar 136016 credit bureaus. This assures their continued success in operating their business.

Credit reports are important not only fromrepparttar 136017 standpoint of providing identification information, additional addresses unknown torepparttar 136018 client, and/or additional name variations inrepparttar 136019 form of aliases and/or akas, but they also provide an almost up-to-the-minute window of credit activity pertaining torepparttar 136020 subject. This gives an impression ofrepparttar 136021 subject’s credit worthiness with respect to paying offrepparttar 136022 obligationsrepparttar 136023 subject is currently faced with, not to mention, in many cases, his or her current whereabouts.

If an overwhelmingly favorable credit report is generated onrepparttar 136024 individual, chances are strong thatrepparttar 136025 subject may be hiding assets, and a more aggressive collection and/or litigious pursuit is justified. Ifrepparttar 136026 individual’s credit is in a “pre-bankruptcy” mode, chances are strong thatrepparttar 136027 lack of discovery of available assets, which would affectrepparttar 136028 decision whether to charge-off or litigaterepparttar 136029 matter, is more easily palatable byrepparttar 136030 analyst.

Credit histories also contain adverse public records that may not have been developed throughoutrepparttar 136031 course ofrepparttar 136032 search, sincerepparttar 136033 primary search parameters are on an exact name basis, and usually a specific jurisdiction basis only. The benefit of credit reporting agencies is that they procure information from large repositories, which contain information from jurisdictions that may not necessarily be germane torepparttar 136034 original asset search request.

Corporate Affiliations

A determination of an individual’s Officer/Director and/or Registered Agent status within a corporation is important to determine whether or not that individual may own stock in that enterprise, which can also be determined somewhat by a search of applicable public records within certain state jurisdictions. Some states do not provide public access to information with respect to stock ownership in corporations, yet many states do provide information with respect torepparttar 136035 Officer/Director and/or Registered Agent status of an individual.

These searches are conducted atrepparttar 136036 Secretary of State level, and ifrepparttar 136037 information is developed, certain other information with respect torepparttar 136038 corporate enterprise may be provided. This includesrepparttar 136039 status ofrepparttar 136040 corporation (i.e., good standing, suspended, or forfeited),repparttar 136041 filing date and filing numbers ofrepparttar 136042 corporate enterprise, andrepparttar 136043 subject’s affiliation withrepparttar 136044 enterprise.

Many states require a secondary search level to be undertaken, which isrepparttar 136045 procurement of a “Statement of Officers/Directors” (ET SEQ.). There are database repositories, which provide President and/or Registered Agent information. However, most searches that develop Officers and Directors must be conducted by hand atrepparttar 136046 applicable state jurisdiction. Security & Exchange Commission files provide information on individuals who own more than 10% of a publicly held or publicly traded corporate entity. This search is conducted by database through a few private companies, andrepparttar 136047 searches are, by and large, undependable. The searches conducted directly throughrepparttar 136048 SEC, which are extremely time-consuming, arerepparttar 136049 only valid searches to rely upon within this instance, and for all intents and purposes, inside information with respect to this file indicates that it is roughly 80% accurate and complete.

Partnerships

Searches for partnerships, be they limited partnerships, general partnerships, or specific partnerships, are conducted atrepparttar 136050 state and local jurisdictional levels, depending uponrepparttar 136051 state. In California, for example, searches atrepparttar 136052 California Secretary of State’s Office identify “LP-1” Statements, which are filed byrepparttar 136053 general partner ofrepparttar 136054 limited partnership, and identify not only a name reservation, but alsorepparttar 136055 name ofrepparttar 136056 general partner ofrepparttar 136057 business. This one-page form is not a full-blown search with respect torepparttar 136058 partnerships that could pertain to an individual. The search conducted atrepparttar 136059 county or parish jurisdictional level would identify all general partnerships, which would be required to be recorded and limited partnerships which own real estate.

Uniform Commercial Code Filings

While a Uniform Commercial Code Financing Statement could be primarily viewed as a lien instrument, inrepparttar 136060 context of an asset search it should be addressed as more of an asset determinator. Fromrepparttar 136061 perspective of a UCCs relationship to an asset, when an individual is identified as a debtor, usuallyrepparttar 136062 debtor’s status pertains torepparttar 136063 securing of personal property for a business that may not have been disclosed throughoutrepparttar 136064 course of additional research.

Factual Employment Screening – Part One

Written by Thomas C. Lawson


We have all heard in recent years thatrepparttar need for a substantive policy of conducting pre-and post-employment background checks exists in more than just defense contractor and fiduciary-based enterprises. Today, withrepparttar 135994 overwhelming preponderance of employer liability litigation, and with negligent hiring beingrepparttar 135995 focal point of round-table discussions of some ofrepparttar 135996 plaintiff’s firms,repparttar 135997 need for thorough background checks has been substantiated. This is a common sense perspective, not only fromrepparttar 135998 standpoint of gettingrepparttar 135999 best possible people forrepparttar 136000 job, but also to protect a company form this type of litigation.

In 1979, our company set out to learn how to not only providerepparttar 136001 best possible background checks, but also to determine just where “factual employment screening” would fall inrepparttar 136002 scheme of things. To understand why “screening” is where it is today, one needs a little history ofrepparttar 136003 subject.

Inrepparttar 136004 beginning, screening usually started withrepparttar 136005 security department. These were typically highly qualified, deeply motivated, wholly energetic, recently retired law enforcement professionals who were completely inundated. After being givenrepparttar 136006 entire responsibility forrepparttar 136007 safety and security ofrepparttar 136008 company, its executives and their families, they were givenrepparttar 136009 task of qualifying those who would pass throughrepparttar 136010 gates each day as employees. Since these individuals were forrepparttar 136011 most part “old boys,” they sometimes used, in today’s politically correct terminology, “improper” methods of “checking out”repparttar 136012 applicants.

This responsibility typically stayed inrepparttar 136013 security department until aboutrepparttar 136014 late 1970s, when what are now called human resources departments sawrepparttar 136015 need to get inrepparttar 136016 loop for what was to become “employment screening.” Needless to say, those “improper” methods referred to have all but disappeared in smart companies. However, due torepparttar 136017 lack of knowledge of some human resource personnel when it comes to things like criminal records, credit reports, and driving histories, some have fallen prey to those who would sell them “employment screening” atrepparttar 136018 touch of a button. As you will see later, this can pose a big problem.

Why do you need to know this simplified history? Simple – not all companies evolve equally, and in order to understand whether or not you are going to get your pilot program of employment screening to fly, you need to know whererepparttar 136019 exposure for negligent hiring will rest inrepparttar 136020 scheme of things. Talk about inner conflict – try to become thoroughly knowledgeable in eitherrepparttar 136021 security or human resources area, let alone both! These are two disciplines, which may rarely see eye to eye on anything.

But you are going to have to know both equally well if you re charged with spearheadingrepparttar 136022 drive to get your company’s management to commit to a competent policy of factually screening employment candidates, regardless of your position. In this era of “political correctness” we are often reminded that, more often than not, something cannot be “right” or “wrong” because ofrepparttar 136023 judgmental connotations those words convey. Employment screening is not immune to this distinction, but as well all know, facts are facts, and ventrepparttar 136024 best con artist can’t dispute them. This is why you must be thorough in conducting a background check.

This article will not address drug testing, psychological testing referencing, or verification work, as these areas do not yet have as many legal implications surrounding them, and most employers have their own methods which are about as unique as fingerprints. However,repparttar 136025 following recommendations are suggested for a comprehensive screening program.

Three “Must Knows”

You must knowrepparttar 136026 person’s true identity by obtaining positive candidate identification. Major recent studies have shown that as much as 20% to 30% ofrepparttar 136027 population maintains undisclosed aliases or AKAs. This is critical, since checking a wrong name for criminal convictions will yield a “no record” response almost every time. There are many ways that an identity can be verified and cross-checked without breakingrepparttar 136028 law. These are usually proprietary torepparttar 136029 vendor, but can include social security number traces, driver’s license number checks, address-telephone verifications, and a myriad of other attainable bits of research.

You must grasprepparttar 136030 person’s responsibility attitudes. This is usually best determined by a person’s payment attitudes (credit history and driving history. Beware! One argument that is encountered against running credit reports is that “minorities have it tougher.” While studies do exist that set forth deficient societal and employment opportunities which plague certain groups,repparttar 136031 fact is that if an employment candidate agrees to pay someone back after borrowing money from then, but doesn’t, it doesn’t matter what their color, race, sex, or persuasion is.

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