investigators | business fraud | criminal defensedue diligence
Conducting international investigations...
Oct.01.2024
We had a great panel discussion on international investigations at the 99th Annual World Association of Detectives conference in Kuala Lumpur. Always great to see old friends and meet some new ones. The hospitality of our Malaysian hosts was out of this world! Enjoyed the numerous meals of chicken rendang and satay. And the city was a treat. One point overall was the transnational nature of crime requires us to educate resistance at the ground root level. Governments are failing to keep to speed as scams targeting the elderly, "pig-butchering", romance scams and others are getting more sophisticated.
Throwing the bolt: When due diligence is too late
Feb.24.2022
What industry is most ignorant about background checks, even for high level hires? For me, it continues to be boutique merchants & restaurants. They love to rely on "insider industry knowledge" when hiring. Even when hiring top level manager, executive chefs, CFOs, they refuse to do a basic background check and look at criminal record, civil litigation, agency hearings, or license violations.
We usually see these kinds of clients paying for post-facto due diligence— defending a lawsuit, sexual harassment cases, fraud, vendor theft, etc. It is like a rancher throwing the bolt on the barn door the morning after a prized horse ran off.
As a business owner, you should consider what signals you are sending to a new employee by not doing background checks. No, it is not "making things easy" for a new hire, even during an economic times where employees are in great demand. You are signaling that taking shortcuts is acceptable in your business. That you accept less than someone's best efforts. Employees accustomed to more professional employers will notice that you are not doing those things. Is that the impression you want to make on your employees?
Protect yourself and show your business.
We usually see these kinds of clients paying for post-facto due diligence— defending a lawsuit, sexual harassment cases, fraud, vendor theft, etc. It is like a rancher throwing the bolt on the barn door the morning after a prized horse ran off.
As a business owner, you should consider what signals you are sending to a new employee by not doing background checks. No, it is not "making things easy" for a new hire, even during an economic times where employees are in great demand. You are signaling that taking shortcuts is acceptable in your business. That you accept less than someone's best efforts. Employees accustomed to more professional employers will notice that you are not doing those things. Is that the impression you want to make on your employees?
Protect yourself and show your business.
Fantastic Beasts of the Background Check World: the "national criminal search"
Feb.21.2020
Every investigator gets phone calls like this. The tone excited, the tenor demanding. How can you, sir, charge so much money for a background check when other firms offer "national criminal record checks" for $24.95?
Our response is: Do you want to buy a griffin? A hippogriff (half-horse, half-eagle, 100% fantasy)? Time to review Fantastic Beasts of the background check world.
The national criminal check is a myth. What constitutes a “national criminal check” or “nationwide employment criminal background” as the product is often described? Usually, the firm offering this search is checking a compilation of conviction data--people who actually were sentenced to prison. However, only a very small percentage of people charged with crimes ever do any prison time. National offender databases are misleading: they miss charges that have been pled out, dismissed, not prosecuted (nolle prosequi, the legal term of art meaning the prosecutor is unwilling for some reason to pursue the case).
How do you actually check for Criminal Records?
Everyone is familiar with scenes from movies where a law enforcement agent runs a quick database check and gets an entire criminal history in seconds. In real life, things tend to be a bit more convoluted.
One database used by law enforcement is the National Crime Information Center (NCIC) and it is typically limited only to law enforcement. While the closest thing to a national criminal records database, even NCIC data is riddled with gaps, with as many as 50% of all criminal cases failing to hit the database. So how do you proceed to check a person for crimes committed across 50 states in the USA?
Convictions data is a start but we always go back to the primary sources of criminal records: the state court system. On the state side, this means searching a higher court (Superior Court) that handles major crimes in a particular county, as well as lower courts with more limited jurisdiction. These courts are called district courts or municipal courts. Don’t make the mistake of skipping this step as district courts can hear cases involving serious criminal matters; for example in Massachusetts, some felony cases are found in district court. And access to the dockets still remains mixed: Massachusetts still keeps criminal records off the internet; you need to look at the index in the court.
And on the federal side, you will be checking for criminal cases in the national PACER system.
So just beware when you are conducting a criminal background check for employment or any other purpose: to do it right, the investigator may need to leave the office and review records ((paper or database) at the courthouse. Be certain that you are buying more than the fantastic beast of a "national criminal check" which is usually just convictions data.
The national criminal check is a myth. What constitutes a “national criminal check” or “nationwide employment criminal background” as the product is often described? Usually, the firm offering this search is checking a compilation of conviction data--people who actually were sentenced to prison. However, only a very small percentage of people charged with crimes ever do any prison time. National offender databases are misleading: they miss charges that have been pled out, dismissed, not prosecuted (nolle prosequi, the legal term of art meaning the prosecutor is unwilling for some reason to pursue the case).
How do you actually check for Criminal Records?
Everyone is familiar with scenes from movies where a law enforcement agent runs a quick database check and gets an entire criminal history in seconds. In real life, things tend to be a bit more convoluted.
One database used by law enforcement is the National Crime Information Center (NCIC) and it is typically limited only to law enforcement. While the closest thing to a national criminal records database, even NCIC data is riddled with gaps, with as many as 50% of all criminal cases failing to hit the database. So how do you proceed to check a person for crimes committed across 50 states in the USA?
Convictions data is a start but we always go back to the primary sources of criminal records: the state court system. On the state side, this means searching a higher court (Superior Court) that handles major crimes in a particular county, as well as lower courts with more limited jurisdiction. These courts are called district courts or municipal courts. Don’t make the mistake of skipping this step as district courts can hear cases involving serious criminal matters; for example in Massachusetts, some felony cases are found in district court. And access to the dockets still remains mixed: Massachusetts still keeps criminal records off the internet; you need to look at the index in the court.
And on the federal side, you will be checking for criminal cases in the national PACER system.
So just beware when you are conducting a criminal background check for employment or any other purpose: to do it right, the investigator may need to leave the office and review records ((paper or database) at the courthouse. Be certain that you are buying more than the fantastic beast of a "national criminal check" which is usually just convictions data.
Background Check Myths - The National Criminal Check
Feb.09.2016
Every investigator gets phone calls from this person. The tone excited, the tenor demanding. How can you, dear sir, charge so much when other firms offer "national criminal record checks" for $24.95?
Time to review Fantastic Beasts of Background Myths: what constitutes a “national criminal check” or “nationwide criminal background check” as the product is often described.
The national criminal check is the hippogriff of the industry, a complete myth. Usually, the firm offering this search is checking a compilation of conviction data--people who actually were sentenced to prison. However, only a very small percentage of people charged with crimes ever do any prison time. National offender databases are misleading: they miss charges that have been pled out, dismissed, not prosecuted (Nolle prosequ, the legal term of art meaning the prosecutor is unwilling to pursue the case).
Everyone is familiar with scenes from movies where a law enforcement agent runs a quick database check and gets an entire criminal history in seconds. In real life, things tend to be a bit more convoluted.
One database used by law enforcement is the National Crime Information Center (NCIC) and it is typically limited only to law enforcement. And even NCIC data is riddled with gaps, with as many as 50% of all criminal cases failing to hit the database. So how do you proceed to check a person for crimes committed across 50 states in the USA?
Convictions data is a start but we always go back to the primary sources of criminal records: the state court system. On the state side, this means searching a higher court (Superior Court) that handles major crimes in a particular county, as well as lower courts with more limited jurisdiction. These courts are called district courts or municipal courts. Don’t make the mistake of skipping this step as district courts can hear cases involving serious criminal matters; for example in Massachusetts, some felony cases are found in district court.
And on the federal side, you will be checking for criminal cases in the national PACER system.
So just beware when you are scanning someone for a criminal history: to do it right, the investigator will probably need to leave the office and pull some paper records. A thorough investigation will take more than just a database search.
Time to review Fantastic Beasts of Background Myths: what constitutes a “national criminal check” or “nationwide criminal background check” as the product is often described.
The national criminal check is the hippogriff of the industry, a complete myth. Usually, the firm offering this search is checking a compilation of conviction data--people who actually were sentenced to prison. However, only a very small percentage of people charged with crimes ever do any prison time. National offender databases are misleading: they miss charges that have been pled out, dismissed, not prosecuted (Nolle prosequ, the legal term of art meaning the prosecutor is unwilling to pursue the case).
Everyone is familiar with scenes from movies where a law enforcement agent runs a quick database check and gets an entire criminal history in seconds. In real life, things tend to be a bit more convoluted.
One database used by law enforcement is the National Crime Information Center (NCIC) and it is typically limited only to law enforcement. And even NCIC data is riddled with gaps, with as many as 50% of all criminal cases failing to hit the database. So how do you proceed to check a person for crimes committed across 50 states in the USA?
Convictions data is a start but we always go back to the primary sources of criminal records: the state court system. On the state side, this means searching a higher court (Superior Court) that handles major crimes in a particular county, as well as lower courts with more limited jurisdiction. These courts are called district courts or municipal courts. Don’t make the mistake of skipping this step as district courts can hear cases involving serious criminal matters; for example in Massachusetts, some felony cases are found in district court.
And on the federal side, you will be checking for criminal cases in the national PACER system.
So just beware when you are scanning someone for a criminal history: to do it right, the investigator will probably need to leave the office and pull some paper records. A thorough investigation will take more than just a database search.
Due diligence pays for Nardizzi client
Feb.27.2017
In the wake of repeated news of SEC investigations of hedge fund and investment management firms, an investment bank credited an early-stage due diligence report by investigative firm Nardizzi & Assoc. for saving clients from multi-million dollar fraud losses.
The Securities and Exchange Commission charged a Pearl River, N.Y., investment management firm Westgate Capital Management, LLC and its managing member, James M. Nicholson with operating a large-scale scheme that defrauded hundreds of investors of millions of dollars. The SEC alleges that Westgate solicited investors with false claims of an almost unbroken eight-year string of monthly investment successes.
In the fall of 2007, a New York investment bank had retained Nardizzi & Assoc. to investigate links between Nicholson, Westgate, and other individuals. The report issued by Nardizzi swayed the investment bank away from investing with Nicholson.
The arrest of Nicholson made waves in tony Palm Beach as well, as reported in the Palm Beach Daily News:
“The vigilance of Madoff-wary investors has helped bring about the arrest of another part-time Palm Beach resident, the manager of an unregistered hedge fund accused of swindling an estimated $900 million from clients since 2004.
The FBI on Wednesday arrested James M. Nicholson, 42, owner of a penthouse in the Dunster House condominium complex, on charges of securities fraud and bank fraud. Also on Wednesday, the Securities and Exchange Commission filed a federal complaint against Nicholson and his company, Westgate Capital Management LLC of Pearl River, N.Y., seeking relief for the fraud and an injunction to stop it.
A telephone call to Nicholson's primary residence in Saddle River, N.J., was not returned by press time. A telephone line listed for Nicholson's multi-million dollar Dunster House penthouse was disconnected.”
The investigation into Nicholson began when Westgate investors reacted to alleged Ponzi mastermind Bernard Madoff's $50 billion scheme. When they began to redeem their own investments in different Westgate hedge funds, nearly $5 million in checks bounced.
The SEC released this statement regarding Westgate Capital Management, LLC and its managing member, James M. Nicholson, who was arrested by the FBI at his New Jersey home.