Asset Investigations Part 2 of 3

In this part two I want to talk a little about physical assets.  This is usually the easiest part of any asset investigation in Arizona.

All private investigators should have access to a database that allows them to perform generic searches for physical assets like property which, I will talk about first.  In some cases a database search is all you need.  If your subject/debtor is a professional and/or has been "hiding" these assets may be harder to find.

Worst case scenario is you have a judgment against a professional debtor.  Chances are they have been in the game for a long time and know all the tricks of the trade.  Without disclosing more than necessary to avoid helping these types hide even further, tracking property can be pretty simple.  As discussed in a previous blog its all about finding patterns.

Once a property or home is acquired that record never goes away.  It becomes very easy to start from the beginning of that assets life and move forward with owners of record.  What some of these professional debtors like to do is transfer a property to a LLC, Inc or the like.  Once the paperwork is approved and completed they will then fraudulently change the name on the LLC paperwork to a
completely fictitious name for owner/manager making it almost impossible for the average private investigator to track.  As mentioned before, some private investigators are lazy and some are just bad investigators.  In the end its really simple, you follow the money and you start from the beginning of that assets life.

Hopefully if you read Part 1 you are asking how this ties into the awful report I received from another firm.  The original report contained only one property.  My initial investigation had revealed that this particular subject had at one time owned 11 different homes and properties throughout Arizona and Nevada.  What had happened was our debtor knew a lawsuit was in the works and did exactly as I mentioned above.  When the investigation was complete I essentially was able to show that this debtor had fraudulently transferred 9 of the 11 assets to LLC's with managers that really didn't exist.  I was further able to show the paperwork taking his name off the LLC's with his signature and adding a total of 10 ghost managers.  It did cost the client a large amount of money in attorney's to fight this in court but in the end the judge couldn't deny the facts that we had provided.

On a side note, some really brazen and educated debtors manipulate bank accounts this way as well.  I will talk about that in another blog.


The last thing I want to touch on is vehicles.  A lot of investigators over look this for some reason.  Its really simple for private investigators to get this information from the Department of Motor Vehicles.  Its relatively cheap and quick.

For whatever reason a lot of folks with money like their cars and a lot of the time classic cars.  99% of the time these assets are paid off making them gold mines for seizures to pay your judgment or debt off.




I know this particular section wasn't informative as the others but again I didn't want to disclose to much and educate the debtors who are on the edge of becoming professionals.


As always if you have any questions feel free to contact me anytime.



John Hopper
Director of Investigative Services
JB National Investigations, LLC
john@jbnational.com
www.jbnational.com 

Asset Searches. What Does That Really Mean? Part 1 of 3

www.jbnational.com

All of you have heard the term "asset search" before.  Like our blog on backgrounds, asset searches are at times cookie cutter and just flat horrible.  Now that you have paid, sometimes thousands of dollars, for your search you receive a report, at times lengthy, and probably full of "fluff".

I will give you one example of a report I personally received from another firm that "specialized" in collections and asset location looking for my help to further their investigation.  As you read I will explain what they did and what JB National Investigations did so that you can come to your own conclusions about whats professional and through and whats not.

I received a legal folder with 28 pages which at first glance appeared to be full of pertinent information.  I was a little intimidated by the amount of information I was receiving wondering what else I could possibly uncover that they hadn't.  That intimidation quickly subsided once I was back at my desk and began to parse through the provided information.

What I had found, much like "basic" backgrounds, was that the information provided was simply a credit report, some old bank statements as well as information that was obviously taken from a simple database search.

If I were to take all of the FACTS that were listed in their report it may have taken 2.5 pages total.  What was in the other 25.5 pages?  Cut and paste pictures of current and past properties, cut and paste maps, the last 3 owners of a certain property (this could be useful but not in this particular case), pictures of the interior of homes that were completely outdated, paragraph upon paragraph of speculation, several pages of what used to be owned by the subject years prior to any involvement in legal action.....I could go on but it would be pointless, it was a report full of nothing basically trying to justify to their client their fee.

Let me now tell you what you need to know, what should be included in any written report and whats relevant when it comes to asset searches.

The most important piece of any asset location or search, especially for recovery, is getting a realtime "snapshot" of their assets prior to any action, legal or otherwise.  This is paramount in cases of professional debtors, people committing fraud, and/or people who owe significant amounts of money.  This "snapshot" will allow you to present this information to a judge and/or your attorney and prove

where the assets were prior to any action taking place.  This becomes important should your "bad guy" decide to start moving assets.  In almost all states its a crime to "fraudulently transfer" any asset with the intent to "hide" and/or circumvent legal action of any kind.  Arizona for instance takes fraudulent transfer very seriously.

Your state laws may dictate how to move forward but in Arizona the order in which information is relevant definitely starts with liquid assets (cash/bank accounts) which can be seized immediately (with judgement of course).  A professional private investigative firm, like JB National Investigations,  should be able to provide you with your subjects banking institution(s).  If the private investigator you have hired can't offer banking information, chances are they are not a truly professional asset location specialist.

Bank accounts as well as any another cash type account should give you a good idea about how the rest of your investigation will go.    For instance if you were to garnish four accounts and they only contained a total of $1000 when you are looking for millions either your debtor/subject is very good or there just aren't enough liquid assets to continue to "throw good money at bad money".

The search for accounts should not be limited to "standard" financial institutions.  They should include all retirement accounts, 401k's, IRA's etc.

In some cases an account garnishment may be all you need to accomplish your investigative goals.

Now that you know what your private investigator should be doing let me tell you what JB National Investigations did for the client we talked about at the beginning of this blog.

JB National Investigations followed the above mentioned standard to the letter when continuing the investigation for our now client.  What we found as far as liquid assets were concerned was significant.

The subject of this particular investigation had scores of bank accounts in multiple LLC's, personally, the spouses name as well as shell companies of the mentioned LLC's.  We spent weeks putting together a chain of custody for ownership for bank accounts.  None of this information was even mentioned in the supplied report.  Of course as with any criminal who commits fraud or professional debtor they show a pattern if you are able to gather enough intelligence on them.  Of course our debtors pattern emerged which made our search for physical assets much easier.



I will talk about physical assets in Part 2.


If you have questions or would like to know more about asset investigations please contact me anytime.


John Hopper
Director of Investigative Services
JB National Investigations, LLC
john@jbnational.com


For further reading on offshore assets searches I found another blog that may interest you.

A Phoenix Arizona Base Private Investigations Firm

Its not just someone else's problem.....

http://www.theguardian.com/law/2013/sep/02/tougher-laws-stop-companies-benefiting-from-fraud

• Simon Bowers
• The Guardian, Monday 2 September 2013 16.10 EDT

Plans to reform the test for criminal prosecutions could boost the forepower of the Serious Fraud Office to initiate prosecutions.

Banks and other businesses benefiting from fraudulent behaviour will be more likely to join their employees in the dock under proposals being considered by ministers, borrowing from a tough US approach to corporate offending.

Plans to reform the test for criminal prosecutions could trigger a new wave of fines and criminal convictions for businesses and transform the armoury of the Serious Fraud Office, marrying up with new SFO powers to reach financial settlements with companies, known as deferred prosecution agreements(DPAs).

It would also go some way to meeting the Conservative party's pre-election pledge to "strengthen corporate criminal law to ensure companies can be held liable for their actions". That 2010 promise was made in the face of widespread public frustration at the failure of criminal and regulatory authorities to bring companies and individuals to book after the 2008 banking crash.

The latest proposals are yet to win unanimous support in Westminster, with some officials — particularly within the department for business, innovation and skills — understood to be weary of any legislative moves that could be perceived as hostile by the business lobby. In the wake of the Libor-fixing scandal, however, others in government are adamant that the credibility of the authorities policing the markets is vital to safeguarding the integrity of London as an international financial centre.

The SFO is still pursuing its investigation into Libor fixing, having secured additional funding for its inquiries from the Treasury. It has so far charged one bank trader and two money-brokers, and has yet to decide whether to bring charges against banks or other companies.

Prosecutors rarely pursue charges against companies in large fraud cases because the existing law requires that they prove a "directing mind and will" of a company was complicit in the offence. In practice, this typically means they must present evidence that board-level executives were at the centre of a fraud.

SFO director David Green, a strong supporter of reform, said: "The way companies work today, the email chain tends to get rather sparse among very senior managers … But if a [company] has gained from dishonesty, why should it be able to chuck a few mid-ranking people overboard and sail onwards?"

New proposals borrow a criminal liability test which already exists in cases of bribery, under which companies can be prosecuted for "failing to prevent" corrupt payments even if top executives had no immediate involvement in the dishonesty.

But as well as creating this offence, the 2010 Bribery Act also offers businesses the opportunity to defend themselves by demonstrating they had in place "adequate procedures" to prevent corruption.

This test is similar to the powers available to US prosecutors, who assume vicarious corporate liability for fraudulent behaviour on the part of employees. This has armed the Department of Justice with formidable powers to take on some of the largest corporations in the world, often winning financial settlements that allow the company to accept responsibility, pay a fine and then quickly draw a line under the affair.

While proposals under consideration in the UK fall short of the aggressive US approach, critics claim such reform would criminalise what amounts to negligence — a mater not involving dishonesty and ordinarily confined to the civil courts. Green counters: "If that is so, it [corporate criminal liability for fraud] would only be for a very high degree of negligence".

He added: "[Reform] would help promote a better corporate culture in Britain. Poor corporate culture was a contributory factor in the crash."

Jonathan Fisher QC, a barrister specialising in financial crime, has been a long-standing proponent of reform, insisting that DPAs are unlikely to prove an effective tool without a credible threat of corporate prosecution. "If you put yourselves in the shoes of a company, the first thing you are going to ask yourselves in cases like these is: 'What are the chances of conviction'? If it is low, there is little point in engaging in discussions about a settlement."

A spokesman for the Attorney General's office said: "The Government has a range of policies in place in relation to fraud, and all legislation is kept under review." The proposed reform is already supported by shadow attorney general Emily Thornberry.

But the prospect of increased powers to prosecute companies, even where there is no evidence that top executives are involved in dishonesty, is likely to meet with sharp opposition from business lobby groups. They are already unhappy with the 2010 bribery laws and have pressed ministers to review them, the requirement to show businesses have in place "adequate procedures" to prevent corruption amounts to an onerous red tape burden. The are expected to lobby hard against a similar test for corporate fraud.