Archive for the 'Company Research' Category

The End of Dialog

The database aggregator, Dialog, is no more. It was consumed by ProQuest to become ProQuest Dialog. The resulting product has become completely useless to us for due diligence and corporate research.

The Standard & Poor’s and Corporate Affiliation databases are gone along with several others that we relied upon to create a basic profile of a company’s structure and operations. Alternatives exist, but none are as convenient as the old Dialog.

Getting Advance Knowledge of New Products

Companies operating in the U.S. often file ‘Intent-To-Use’ applications for trademarks and thereby disclose the names and descriptions of forthcoming products and services six months before the product launch. Extensions of up to two years are sometimes granted if the launch process becomes bogged down.

Searching the Trademark Electronic Search System (TESS) of the U.S. Patent & Trademark Office will find the ‘Intent-To-Use’ applications.

Hazardous Material

The Emergency Response Guidebook published jointly by the Canadian Department of Transportation, Mexican Transportation agencies, and the USDOT lets you identify the hazardous contents of pipelines, trucks, or trains from the placards on the side of the tanker, rail car, or pipeline. The guide lists specific hazards and evacuation distances for spills or fires. However, it doesn’t provide any spill/fire/explosion protocols.

If you are around hazardous materials and their transport conveyances then you need this guidebook.

California Business Entity Filing Improvement

Starting on 1 January 2013, the California Secretary of State (CA SOS) implemented changes to entity and agent address information required in business entity filings. The CA SOS memorandum is online here.

UK Company and Director Information

Company Check Ltd. has “compiled records of over 5 million company directors (in its Director Check database), every company they are part of and the financials behind them, allowing you to see background information and other interests of company directors in the UK. Information about Directors includes Full Name, Date of Birth and Registered Address.”

They also operate the Company Check site where company registration details, key financials and director records, are currently available at no charge. Paid subscribers can also access current and historical credit scores and limits, county court judgments, detrimental data and more.

To search directors and officers go to:
http://company-director-check.co.uk/
To search companies go to:
http://companycheck.co.uk/

These are not replacements for searches of the authoritative source, Companies House, but they are useful for initial searches.

The descriptions of the two sites raise some questions about content if both represent the same official data source. As you can see above, Director Check says it has records for 5 million directors. However, the Company Check site gives the following stats: “12,000,000 directors listed with 10 million service addresses… 8,000,000 companies stored in our database.” I guess they are saying that they only made 5 million directors searchable in the Director Check database.

City Business Licences

Most cities issue business licences. Some cities make it easier to search the licences than others. Toronto allows you to make your own database by offering a Comma Separated Value (CSV) file at http://opendata.toronto.ca/mls/business.licences/business.licences.csv. This is great if you want to track what is at an address over time. We get this file every year and add a field for the year we get it.

You can use the Business Licence Lookup site at http://app.toronto.ca/LicenceStatus/setup.do?action=init to conduct an individual search.

 

Bulk Sales & the PI

BULK SALES ACT SEARCHES – Ontario Only

Sales of large quantities of stock or the sale of assets and equipment of the business itself outside the regular course of business are considered a sale “in bulk”. The Bulk Sales Act is designed to protect the creditors of a business owner by requiring the owner to follow the procedures of the Act for sales outside the regular course of business.

If a buyer wishes to purchase the assets and equipment of a business, the seller “in bulk” must provide an affidavit stating that all creditors have been paid, or they will be paid from the proceeds of the sale.  In some cases the buyer pays an assigned trustee and creditors of the business may wish to waive their rights in which case the proceeds are paid.

A ‘Bulk Sales search‘ determines if a bulk sales affidavit has been filed with the relevant Ontario Superior Court of Justice office.

The Private Investigator (PI)

If you are interested in an Ontario business’s assets, debts, cash flow, and general financial condition, then a a Bulk Sale Act search is an important search.  It may tell you if the business is failing or if it has suffered a set-back.  You may learn of an abandoned line or the sale of a production facility.  You may learn of a legal action in another jurisdiction by contacting or researching the other parties to the bulk sale. Any sale that indicates that creditors will be paid from the proceeds of the sale may indicate a judgment that is being satisfied or it may be part of the settlement of a claim.

 

The Bank Act & the PI

The Bank Act

The Bank Act (1991, c. 46) is an Act of the Government of Canada respecting banks and banking.  The Canadian banking industry includes 20 domestic banks, 24 foreign bank subsidiaries and 22 foreign bank branches operating in Canada.

Canadian Banks & Lending

Canadian Banks have the right to lend money to wholesalers, retailers, shippers and dealers in “products of agriculture, products of aquaculture, products of the forest, products of the quarry and mine, products of the sea, lakes, and rivers, of goods, wares and merchandise, manufactured or otherwise” on the security of such goods or products, and to lend money to manufacturers on their goods and inventories.

The Private Investigator (PI)

When doing a background investigation of a person, the PI will be looking for previously unknown assets, banking and financial arrangements, or corporate affiliations.  When investigating a company, the PI will be looking for previously unknown assets, banking, and financial arrangements.  In both cases, the equity held by the subject in the assets will be of interest.  Searching the Bank Act Security Registry may reveal all of the above.

Bank Act Security Registry

Under S. 427 of the Bank Act, the borrower must sign a document that provides the bank with the first preferential lien on the goods or equipment.  The Bank then registers a ‘Notice of Intention‘ to take the goods as security, to perfect its security interest.

The Bank of Canada offers a Security Registry service which may be searched for registrations.  The search will reveal whether the Bank of Canada has taken security on property that may interest you.  If the Bank does have a claim on the property, then it means that it has loaned the customer money and that it has the right to take possession of and sell the property if the loan is not paid.  This is important for you to know for two reasons.  First, it shows that the person or business is indebted to a Canadian chartered bank and may have equity in the property listed in the security agreement.  Second, it may uncover previously unknown assets, banking and financial arrangements, or corporate affiliations. You will need to provide the name of the person or business being searched.

Years ago, we only did this when we suspected the subject person or company might have an interest in an agricultural business.  Today however, we find more non-agricultural businesses in the Bank of Canada registry. We have online access to the Bank of Canada registry to search for Bank Act Security items. The search results often indicate that a business assigned its inventory to a bank as security under the Bank Act.

A manual search for Notices of Intention filed under Section 427 of the Bank Act are conducted at the agency of the Bank of Canada in the province or territory where the debtor’s place of business is located. For Bank Act searches,  “agency” means, in a province, the office of the Bank of Canada or its authorized representative but does not include its Ottawa office, and in Yukon, the Northwest Territories and Nunavut means the office of the clerk of the court of each of those territories respectively [see S. 427(5)].

 

BC Environmental Law Violators

Environmental law violators in British Columbia are now in a searchable online database. “The free database includes a wide variety of compliance and enforcement actions taken by ministry staff and enforcement officers. It includes orders, administrative sanctions, tickets and court convictions covering hunting and fishing, open burning, mud bogging, dam safety, and pesticide and pollution violations.”

Operational Risk & Lawfare

Recently, I have been involved in a series of jobs involving Operational Risk.

Operational Risk arises from:

  • inadequate or failed processes and controls,
  • people
  • systems
  • external events
  • contractual obligations
  • compliance issues
  • lawfare

Lawfare is the most interesting aspect of this type of work. Lawfare is a form of asymmetric warfare that is waged via the courts with the intention of damaging the firm. Special interest groups, radicals, and competitors will use this to create financial damage and create ill will towards the targeted company.

The Investigator’s task is usually to identify the funding sources and relationship of the plaintiff to individuals and groups who would benefit from the use of this tactic.

The New Neighbourhood

In the past, most investigations included ‘neighbourhood inquires’ where neighbours were questioned regarding the subject’s activities and lifestyle.

We still do neighbourhood inquiries, but over the last three decades this has produced less and less information of value, to the point that we now consider this an extraordinarily expensive investigative process.

Neighbours rarely share derogatory information or observations about the subject, and fewer still, even know the subject as most urban neighbourhoods are too transient and social contact is minimal.

Today’s neighbourhood isn’t tied to geography, but rather by Internet connectivity. The advent of virtual media has created virtual neighbourhoods that the Investigator must be adept at navigating and interrogating.

This new neighbourhood may reveal inappropriate pictures, drug and alcohol abuse, bad-mouthing of employers, co-workers, clients, and organisations. It may reveal poor communication skills and much worse – much of which is found exclusively online.

Unfortunately, inexpert interrogation and navigation of this neighbourhood has caused issues.

The ubiquity of Internet search engines and a lack of training and guidelines may put the Investigator in contravention of some laws if the resulting information creates a record of personally identifying information that is subsequently mishandled. Possession of Internet search results may impose either declared or implied responsibilities regarding the handling of the data in some jurisdictions.

A casual and undisciplined approach to Internet and social media searching raises questions regarding the competence, handling, fairness, storage, and analysis of the data. The role of the Investigator doing the searching should be clear from the outset. The sources and methods employed should also be clear throughout the search process and its reporting.

Virtual Identities

The subjects of an investigation do not line-up to tell the Investigator all his or her screen names and their related email addresses.

The Investigator must find the screen names and related email addresses from what he already knows at the beginning of the Investigation to build an online profile of the subject.

The Investigator must also recognise that screen names are often used by more than one person or a screen name may be used maliciously.

As the old New Yorker cartoon said, “On the Internet, nobody knows you are a dog”.

Navigation & Interrogation

The unstructured nature of data available on the Internet, and its density, creates problems for the searcher.

Google may say it found three million hits, but it will only show one thousand. The results will change depending on which version of Google searched and whence it is searched.

When searching for information about a person or company, the Investigator shouldn’t get bogged-down by search engine hits, but rather go straight to databases that have the right category of data for his purposes. This may mean searching sources not indexed by the search engines.

Google isn’t a substitute for knowledge and experience.

UK Company Director Search

I found a new new site indexing UK company records based on a snapshot taken on 4th March 2010 which includes names of their directors but not  their addresses. This is searchable by the person’s name.

The people behind it explain:

we bought the Companies House appointment snapshot and dropped it into a quick little searchable symfony app so you can browse the data – it’s the directors and secretaries of every UK company, cross-linked.”

Division of Powers — Incorporation

Incorporation In Canada

The Constitution Act, 1867, S. 92 (11) Awards the provinces the power to allow “The Incorporation of Companies with Provincial Objects”.

You will notice the term “Provincial Objects”. This means that the federal government may also allow the formation of corporations with federal or national objects. The territories may also form corporations.

This means that in Canada, 10 provinces, 3 territories, and the federal government have mechanisms to form corporations.

Company Registers

The following articles have links to company registers that I am often asked about.

Search Results Dominated by One Domain

The following two articles are required reading for anyone who must search by company or product name.

Furthermore, the Official Google Blog  post titled Showing More Results from a Domain, indicates that their algorithm is intended to show searchers more results from a single domain where evidence exits that there is a “strong user interest in a particular domain.”  They also note that the last few results (on a search results page set to show 10 results) are from other domains to preserve diversity in the results.

This has serious implications for anybody doing due diligence research as many derogatory entries in the search engine database will not appear without additional search terms.  It also means that search results set to 10, 20, 30, 50, and 100 per page may give radically different proportions of search results when sorted by domain.