Case Studies

Unfair Competition

A client in the petro-chemical products business began noticing unusual, rapid growth by one of its competitors. Our team researched and investigated the source of that growth and found it was due to unfair competition practices by the competitor.The investigation found that the rival was engaging in a series of illegal acts in several countries. Those acts included the illegal alteration of energy consumption measuring equipment and financial fraud. The investigation also found that the competitor had entered into a manipulative agreement with a provider of technology, designed to prevent the client from obtaining the production equipment necessary for the company to remain competitive.

Information Leaks

An international telecommunications company had been working on an intensive, high-cost marketing campaign that was expected to have a significant impact on its market.However, a few days before the campaign was to launch, a competitor launched a suspiciously similar campaign. The client had to stop the planned launch, a move that came at a considerable cost. Our team began researching the situation, using both traditional and highly technical investigative methods, and found that an employee had been colluding with a third party to filter confidential information about the campaign to the competitor.

FCPA - Preventative

A multinational pharmaceutical company asked us to assess the viability of implementing its ethics and compliance policies at its operations in two European countries.In addition to focusing on those aspects of the policy that pertained to corporate compliance with the Foreign Corrupt Practices Act, the assessment took into account local cultures and customs, and included due diligence research on vendors, sales intermediaries and other associated entities that could possibly violate FCPA rules. Each key player in the sales process was educated about the U.S. anti-corruption regulations. The effort resulted in the successful implementation of U.S.-based policies and regulations in countries where the culture and customs often impeded the acceptance of those regulations.

FCPA Investigation

Sometimes, FCPA investigations come about as a result of an internal discovery that a company wishes to declare and make public to authorities. Other times, such investigations take place at the demand of regulatory agencies or legal entities.In this case, the client had received an anonymous message alluding to internal fraud at the company – specifically, the payment of bribes for the purpose of obtaining contracts at one of its foreign subsidiaries. Our investigative team traveled to the country where the bribes were said to be taking place and immediately began researching the company’s business activity there. In reviewing the subsidiary’s finances, our researchers discovered large payments to phantom vendors. Our team interviewed the local employees in their native language, discovering information that would prove essential to the investigation. We gathered documents and electronic information that was analyzed using IT forensic methods. Beforehand, we had worked with the company’s General Counsel and its lawyers to establish the parameters of the investigation and determine what material and documents would be reviewed. The findings of the investigation allowed the company to understand the workings of the improper activity and identify those responsible.

Fraud Detection & Asset Searches

A European client had recently inherited several, diverse family businesses in Latin America. Among them was a steel company that included an old family friend as one of its investors.The client suspected that the business and assets that had been inherited should have been larger, and asked our team to search for hidden assets. The investigation involved several international jurisdictions and included IT forensic of several of the company’s computers. The results were surprising: Not only did we find millions of dollars in assets, but we also discovered that the old family friend, who had benefitted from the family’s complete trust, was fraudulently diverting business to other companies under his control. We found that, unknown to the client, this family friend co-held foreign accounts and investments. The investigation allowed the client to discover the fraud that was being perpetrated and find millions of dollars that had been hidden away.

IT Forensics – Preventive, Regulatory Compliance

A publicly traded company asked our professionals to help it review the internal policies of a newly acquired subsidiary. The goal was to confirm that the company was abiding by the rules and regulations in the countries where it operated, as well as with the internal policies of its new parent company. With the guidance of the parent company’s legal department, an IT forensic investigation was conducted by collecting large volumes of electronic information from computers and servers located in several locations. Working with the client, the team established the parameters of the investigation and determined what information should be reviewed. The findings assured the parent company that its new subsidiary indeed was complying with its standards in most cases. In the few areas where it wasn’t, the company was able to take action to correct non-compliance.

M&A Due Diligence

A Spanish company with multiple, strategically placed retail locations was approached by a prospective investor who wanted to invest in the company in order to fund its expansion.The company, which specialized in selling to an exclusive, high-end audience, had little knowledge about the investor. The business owner initially was not convinced that the proposal was a good opportunity, in part because it represented a loss of control over the company. Nonetheless, he reached an agreement with the investor, and they embarked on the expansion. A short time later, the original business owner heard that competitors had opened stores near some of his company’s existing locations and that the competing company belonged to the investor, who was now his new business partner. He contracted our team to discover whether his new partner indeed was involved in a competing company and whether the investor was engaged in unethical business practices. Our team presented the client with a full report of his new partner’s business activities. In the end, the rumor proved untrue. The investor was not funding the new competing company, although it did employ one of the investor’s former employees.

Internal Company Fraud

M.D. was an accountant at a transportation company in Malaga. She looked impeccable, but looking good didn’t come cheaply.She’d had plastic surgery, drove a luxury car, traveled first class, wore expensive jewelry and lived in a nice, large house. Unfortunately, she paid for it all with money illegally obtained from her employer. She had altered the pay-books to set her own salary. The business owner had become suspicious when he noticed some of the alterations. Then, he started looking at some of the company’s bank transfers, which didn’t seem right. As our investigation would discover, she had a simple system. M.D. would directly transfer money from the company account to her personal account, and then she would log the same amount as a business expense. When it was time to reconcile the bank statements, she would get rid of all evidence indicating what she had done. At first, the amounts were small, but they grew larger in time. M.D. had seemed sure that the business owner would not have someone do an internal audit, nor review the books in much detail. Today, M.D. is facing embezzlement charges.