“We are all too aware of the level of commercial financial fraud that exists in global business operations. We regularly uncover serious breaches in our reports. We are really glad to be working with Graydon to help battle commercial fraud in the UK.” – Mike Hicks, Founder, Catalysis Advisory
In November 2020, Neotas surpassed the exciting benchmark of 100 IDD cases with one of our key partners, Catalysis Advisory.
Catalysis Advisory advises private equity firms on management and organisational issues and is based in London, UK. They have used our social media screening and Enhanced Due Diligence (EDD) services for a number of years. For them, the key reason to use our service in addition to their off-line work is to determine whether the company owners, employees or investors they (or their clients) are looking to work with are ‘Difficult’ or ‘Dangerous’.
This may seem like a small differentiation, but to their clients, this can mean the difference between a good investment or a very costly one. In the field that they operate in, having a CEO or an investor who has qualities which might make them ‘Difficult’ might also be the reason they are able to produce results that no one else can.
However, if someone has attributes which make them ‘Dangerous’, rather than just ‘Difficult’, this could cost their clients millions. Getting this distinction right is crucial for Catalysis Advisory, and the only way they can do this is by gathering far more detailed data. That’s where we come in.
Here’s what Catalysis Advisory have had to say about the service to date:
“Across the 100 or so exercises where we have used Neotas, just over a third have been rated ‘green’, providing reassurance that we and our clients can focus on skills, goals and strategy rather than personal risk.
About 10% have been rated ‘red’, i.e. potential trouble (although some have been difficult not dangerous people). The remainder, inevitably, are amber where either there are discrepancies between different types of information (e.g. LinkedIn vs Company House) or various forms of unfortunate content. Of the amber category, about a third require some kind of follow-up conversation to resolve matters, some of which point towards difficult or dangerous conclusions.”
As you can see, the checks that have flagged ‘Dangerous’ elements are more common than you might expect.
Examples of these include:
- A flashy CEO who demoralised his staff, in part by promoting those who would sleep with him and fire those whom he broke up with
- A COO who needed to be fired for racist and misogynistic abuse of staff
- A founder CEO who boasted about having defrauded his (government) client and threatened exiting staff with violence if they exposed his various nasty tricks.
- A founder who rewarded salespeople for dirty tricks against clients by sharing cocaine.
As you can imagine, the value of avoiding these costly hires and investments were huge, both to Catalysis Advisory and their clients.
We’ve really enjoyed working with Catalysis Advisory over the last three years and look forward to helping them continue evolving the service they offer their clients.
If you would like to discuss how we might be able to help you improve your EDD process, please don’t hesitate to schedule a call with one of our partnerships team here.