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Enhanced Due Diligence Inquiries

The capacity to conduct internal investigations with “boots on the ground” for the company and its supply chain is a critical component of an effective corporate compliance program. The investigation’s thoroughness and integrity are also critical to meeting the U.S. government’s expectations. Policy and Procedures without an effective investigative component expose the company to significant risk. The company’s Corporate Compliance officer & General Counsel must be able to rely on the accuracy of the inquiry in order to make informed decisions regarding additional actions. McCAHON Law has extensive experience in assisting companies in meeting their obligations in this regard. We know the law, culture, language and best practices relative to conducting corporate investigations in Africa, Asia and the Middle East. It is where we live and what we do.

Doing Business in India

India is one of the leading emerging markets, beaming with opportunities for sophisticated investors and pitfalls for the uninitiated. The potential for profits is high, but so are the risks of doing business with the wrong third party agent or target company. Bribery of government officials is commonplace, and an ineffective judiciary renders litigation relief virtually meaningless. For more information, we invite you to read U.S. India Business council, which is our legal services newsletter.

The World Bank ranks India near the bottom of the list of nations concerning the ability to enforce a contract. Arbitration within India has also proved ineffective and unpredictable.

The robust enforcement action of the Foreign Corrupt Practices Act (FCPA) by the U.S. Department of Justice enhances the exposure to criminal action and reputational risk associated with doing business in India. This exposure applies to any U.S. company, person, or their third party agent, who may have been engaged in the bribery of a foreign government official. This dynamic creates a particular problem in countries, such as India, where much of the industry and businesses are state-owned, referred to as Public Sector Undertakings.

It can be confusing to even know who is considered a government official for purposes of FCPA exposure. The lack of publicly available information only furthers the lack of information necessary to determine if a target company or third party agent may create exposure for the acquiring entity.

Sales Report

Our Solution

Our enhanced due diligence does not entail a review of financial records with an assessment of profitability for acquiring an interest in a particular entity. Rather, we focus on the limited scope of identifying risks associated with FCPA exposure, violations of the U.K. Anti-Bribery Act of 2010, embezzlement, and a lack of internal controls. Our knowledge of the country's culture and business practices is invaluable in this regard.

To ensure we get all the local knowledge possible, we use a teaming approach, drawing upon the well-established expertise and integrity of India-based consulting companies, Compliance Consulting Services, Pvt. Ltd., and FBS India, Pvt. Ltd. This is a great way to complete on-the-ground investigation and analysis of individuals and corporations.

We use a sophisticated link analysis methodology to support our inquiries. Our comprehensive inquiries enable our team to provide a full and transparent view of the risks associated with investing in a particular entity or retaining a particular third party agent. Our integrity and internal controls ensure that the client is receiving an unbiased assessment that is not influenced by external conditions or persons.

An enhanced due diligence analysis not only provides the acquiring entity insight into their decision, it also acts as a mitigating factor in any subsequent charging decision by the U.S. Department of Justice in the event of undetected misconduct of the target entity.