Five Considerations When Selecting a Due Diligence Firm


Picking a due diligence provider can be overwhelming. Streamline your search while laying the foundation for a long-term partnership with these five considerations:


Due diligence is an essential component of both corporate compliance and decision-making. Having confidence in your due diligence provider is a must. Before ordering your first report, consider running the provider’s name through a search engine alongside adverse terms such as “litigation OR lawsuit OR case OR complaint OR violation” to get a sense of red flags pertaining to the provider. For added peace of mind, go beyond Google and ask to speak with existing clients. To increase the efficacy of these inquiries, ask for a reference from within your industry. 


Due diligence necessitates sharing sensitive information. This makes it important to inquire about a prospective provider’s policies for protecting the personally identifiable information (PII) of report subjects. PII protection is especially pertinent when due diligence projects include credit checks and the verification of identification documents. Make sure to ask about subcontractors, specifically how they are screened, and how frequently, as well as what sort of privacy guidelines they are required to follow.


Due diligence findings can make or break deals. Are reports being churned out by a rotating crew of recent graduates or being crafted by experienced investigative professionals?  Look for due diligence analysts with specialized academic backgrounds and professional certifications including Certified Fraud Examiner (CFE) and Certified Anti-Money Laundering Specialist (CAMS). If your due diligence needs include international capabilities, it is advantageous to have in-house regional specialists. The ability to infuse projects with foreign language skills and on-the-ground experience is a significant competitive advantage. 


What does client support look like? Having a dedicated point of contact sets the foundation for a successful client/provider relationship. The advantages of working with well-trained researchers are lost if the team is not accessible when client questions arise. Find out what standard turn-around-time looks like from your due diligence provider. Is expedited service available? While you may not initially require this capability, it provides reassurance down the road. Similarly, find out how quickly you can escalate red flags. This includes the ability to conduct various levels of screening running from automated third-party screening to analyst-driven due diligence reports featuring discreet source inquiries. 


A provider should be able to provide fees in advance of work being initiated. Report particulars to be confirmed with the client prior to starting an investigation include what jurisdictions are included, how long the lookback period is, and what searches are covered.

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