Background Investigation
While performing a field examination on a transaction for a leveraged debt fund, Durkin Group’s analyst became concerned about the behavior of the target company’s CFO/ controller. In conversations, he explained how successful and intelligent he was and made a representation that he was a Ph.D. teaching as an adjunct professor at a prestigious university. The controller had been with the target company for approximately six months and was hired through a temporary to permanent staffing firm. Our analyst was unable to confirm the controller’s assertion through research on the university’s website. Based on our analyst’s subsequent uneasiness, we performed a limited background check and identified that the controller was in fact not a Ph.D.; and, he had been previously incarcerated for bank fraud and still owed substantial restitution.
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