Private & Public Investigative Techniques

pi2Investigative tools, procedures, and resources used by private investigators are very similar in the private and public sectors.  For property to be seized or restrained, most jurisdictions require evidence of probable cause which demonstrates that the property was acquired through some sort of illegal activity. A couple techniques used for private investigations include search warrants, surveillance, garbage pickups, and internet and public record data searches.

Typically, search warrants are used to obtain evidence or contraband by searching a person and their private property. A court must order the search warrant specifying when and where law enforcement agents may search for specific things. Although, depending on the jurisdiction, different laws may apply to the execution of the search and how the warrant is obtained. Computers, specifically the data and electronic information stored in them, are often seized through search warrants.

Surveillance is used by both public and private investigators to assist them with their cases. It can range from the use of electronic recording devices to a simple drive-by of a property or residence. However, the more invasive the surveillance is the more likely judicial approval will be required. Electronic surveillance, such as the use of listening devices or wireless intercepts, usually requires a court order if the surveillance invades the reasonable expectation of an individual’s privacy and is mostly only available for use by government agents. Surveillance in general is used specifically to observe and record details about an individual’s lifestyle, interactions, and daily activities. For example, an investigator might conduct surveillance to locate bank accounts, real property, brokerage accounts, boats or cars.

Garbage pickups are another procedure used by investigators to obtain information. However, in order for the information to be legally admissible, the process of acquiring the information must be proper in the jurisdiction in which it occurred. Most jurisdictions allow garbage to be collected and examined after it has been abandoned. The general rule for garbage to be examined without a warrant is that once the trash has been placed in a public area for collection it has been abandoned. One issue with abandonment has to do with curtilage, or rather the land within a dwelling or business in which there is an expectation of privacy. For example, the curtilage of a house would be the front, back and side yards. If garbage is placed in cans within this space it is not considered abandoned. But if the cans are placed on the curb an investigator has the right to collect any garbage within it to analyze and use as evidence. However, if a pickup violates the curtilage then lawsuits, trespassing charges, or inadmissible evidence may result from it.

Lastly, the use of internet and public record data searches are used in private and public investigations. Social media specifically has enabled people to access individuals’ personal information in minutes. Today, a simple internet search can provide an individual’s current residence, birthday, phone number, employment information, and the names of family members and other people that said individual has relations with.

The Importance of Corporate Due Diligence

Corporate due diligence is taking on a new role in business. Many companies are now doing some type of research, due diligence, or background checking on vendors and business partners to help prevent fraud. Recently, I have seen two different cases relating to this.

First, we came across a situation where a company had been doing business with our client for a long period of time. The company had been buying inventory from our client every month, paying for the allotted amount, and reselling it. Towards the end of a year the company approached our client saying they had a really big order and they needed a bunch of inventory. They asked our client to send it right away and that they would pay. Now, this order represented about eight or nine times the company’s typical order so at first our client was purely excited to fulfill it. The inventory was then sent to the company but our client didn’t received payment for it. Ultimately, the one “really big order” resulted in our client losing more money than they had made from this company’s prior orders combined.

Unfortunately for our client, this loss could have been very easily discovered had some due diligence been performed. If our client had looked into it they would have found that the company they were selling to was having major financial problems. The company was behind on their bills, the owner had filed foreclosure, some of the vendors for this company had reported their inventory being diverted and instantly resold wholesale just to generate capital. Additionally, the company had a lien filed against them 30 days prior by the state sales tax department because they weren’t paying sales tax on what they were selling retail. All of these issues would have been reasons to prevent our client from doing business with the company. Had our client done some due diligence before working with this company, it could have prevented a huge loss for them.

The other situation we’ve come across recently relates to fraud and identity theft. In this particular case, a trucking company had some of their corporate documents, specifically their insurance certificate, copied from a website where they posted they were going to do work.  A different trucking agent had one of their trucks and drivers use this other company’s stolen credentials to go pull up to a warehouse, load up inventory, and drive away stealing the cargo. When the inventory didn’t arrive at the other end, the company who shipped the cargo called the name and address on the paperwork only to find out the truck that had taken the inventory had used fraudulent paperwork and stolen their products.

Researching the finances and assets of an individual or company is an important measure to take prior to doing business with them, along with criminal background checks. Don’t just wait for a “really big order” to begin your corporate due diligence. Take a look at your current and prospective vendors, or even other types of business contacts, to make sure that they are legitimate. Be confident that the company or person you’re doing business with will be able to pay, will be able to follow through, and that their prior activities similar to what you’re doing have been handled with integrity. Due diligence may take some time and money initially, but it could potentially save hundreds, thousands, or even millions of dollars in the long run.