13. This One Goes Out to the Attorneys
We regularly work with the legal community to assist not only in forensic investigations and imaging computers but also to complement the desktop research typically performed by paralegals. As experts in information retrieval, we are often hired by attorneys who seek to identify an individual’s assets; locate witnesses; gather intelligence on potential witnesses or opposing parties to actions; and identify, locate, and interview former employees for predeposition interviews. The information we provide to clients has assisted in leveraging negotiations in arbitration matters and lawsuits.
Our experience is that gathering business intelligence is a key component in developing vital information that has the capacity to change the direction of a legal matter. In one case, a law firm was representing a corporate defendant that was being sued by a former employee who alleged the company owed him money. The firm asked us to conduct additional research on the former employee (the plaintiff) to complement research that had already been conducted in-house. We discovered that the plaintiff had a pattern of suing former employers: He had filed three federal-level lawsuits within a ten-year timeframe. Our research also found that the plaintiff fabricated his educational credentials and did not disclose two former employments on his original employment application and resume. These material facts, in conjunction with other leads developed during the course of the research, assisted the attorneys representing the company being sued. In these and other instances, we have served to identify information that impugns the legitimacy of a witness’s statements.
We have also worked with attorneys to help identify a person’s assets. If a law firm represents a bank that is seeking repayment on a loan and the borrower has claimed to be broke, the law firm hires us to see if the borrower is indeed without any assets to repay the loan. (As detailed in Chapter 15, “Show Me the Money: Asset Investigations,” the resources for this are plentiful.) Thinking creatively, we use property records, corporate records, judgment and lien indices, U.S. Tax Court records, campaign contributions, and vehicle registrations. And when someone is an officer of a publicly traded company, we use the Insider Trading database to track shares/options owned and sold by the person and more.
The Situation: The Bragging Banker
A law firm called on us to conduct research prior to an arbitration hearing regarding an individual who claimed the investment firm churned his account. The individual initiated the arbitration against the investment firm, alleging the company took advantage of his naïveté and that he suffered significant monetary losses resulting in him living in a deteriorated, uninhabitable apartment.
At the start, through a review of property records and Uniform Commercial Code filings, we determined the individual owned a luxurious home in a well-known building on Fifth Avenue in Manhattan.
Further, to determine the credibility of the individual’s statements that he was not knowledgeable about the stock market and had relied solely on the advice of his broker, with the approval of counsel, we conducted a physical surveillance of the individual. That turned out to be the wisest decision: We found the “naïve” individual bragging to a group of men at a bar about his savvy knowledge of the market. The incident was discreetly videotaped, and within a matter of days the arbitration was withdrawn.
The Situation: A Leg Up for Lawyers
In several instances we have recommended our clients hire us through their outside counsel for privilege purposes. In one of these situations, a group of investors was interested in a German company and hired us through their law firm. As was relayed to us by the investors’ attorneys, the investors had met with Herr Hoax, the head of the German firm, and were interested in a new form of media he had developed: bringing the concept of the “Choose Your Own Adventure” books to television. At the end of each segment of a crime-based television show, the viewer would have the ability to choose whether the main character would continue on his adventures, travel to a new city where unknown excitement would be found or, possibly, get double-crossed by another character in the show.
The investors and their attorneys travelled to Germany to watch a few preliminary screenings of the idea and were enthralled. Because of the years he spent in media, Herr Hoax told the investors he had unbridled access to the necessary connections in television who were to assist him in bringing the idea to the United States.
The attorneys had reviewed all of the documents about the company, but for some reason they felt they did not have a handle on Herr Hoax, so they asked us to do some due diligence. We dispatched our in-country sources in Germany, who quickly found Herr Hoax had never been involved in media prior to his current company. What was Herr Hoax involved in? Money. Why did he hide it from the investors? Because Herr Hoax had been prohibited from participating in any investment situation by the German Federal Financial Supervisory Authority (known as BaFin).
Through our sources in Germany and the United Kingdom, we were able to piece together Herr Hoax’s history: He was a money manager in the UK until he was charged with tax evasion, at which time he moved his operations to Germany, where he quickly earned the attention of BaFin because of the Ponzi-like scheme he was running there. By the time our investors had met with Herr Hoax, he had already stolen millions of dollars from other investors who were just as excited at the promise of Choose-Your-Own-Hoax. When we relayed the information to the attorneys, we confirmed their suspicions, and they advised their clients to find another investment.
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Locating witnesses is another service for which attorneys rely on investigative companies. As licensed private investigators, we have access to information that many law firms and others do not.
If an attorney knows Billy Bystander has information that is critical to a case, but the attorney has no idea where to find Billy Bystander, we tap into our identifier databases and search the country for Billy Bystander. These identifier databases collect information legally from credit reporting sources, telephone directories, and other sources and compile the information into personal profiles. The information we see includes where a person currently lives and previously lived, his date of birth and a limited portion of his Social Security number, as well as other identifying information that varies by state, such as voter registration information and driver history reports.
If Billy Bystander happens to be a common name, we cross-reference the multiple Billy Bystander listings with information we know about him and try to rule out the other Billy Bystanders to make sure we have the right guy. If we find Billy Bystander lives in an apartment in San Francisco but has an unlisted telephone number, we provide the attorney with contact numbers for Billy Bystander’s neighbors, if need be, or contact them directly if the attorney prefers. And if our client is an attorney on the opposing side of Billy Bystander and wants to know if there is any information on him that would question his credibility as a witness, then we engage in a background check of Billy Bystander and see what is out there.
As stated earlier, running identifier databases is the first step we take in any investigation. This allows us to locate people like Billy Bystander, and gives us a preliminary sense of where we will conduct our subsequent searches. For instance, if Billy Bystander’s identifying information shows he lives in San Francisco but previously lived in Los Angeles, we know immediately that we need to, at least, run court record searches in those two areas. Because the identifier databases provide us with an address history for each person, we use these addresses to find properties owned by a person and companies that may have been formed under a different name but at the person’s known addresses.
Whether we are interviewing people before a deposition to learn more about the statements they are prepared to make, gathering intelligence on potential witnesses, or conducting asset searches, the creative research methods we rely on assist attorneys in gaining leverage in cases and arbitrations where information has the power to influence the outcome.