corporate investigation

When Should an Employer Start a Corporate Investigation

corporate investigationApproximately 99.7% of all American businesses are considered small businesses, and there are almost 32 million businesses nationwide. Comparatively, there are just over 20,000 large corporations. But whether a company has five employees, 150 employees, or 50,000 employees, employers are responsible for the safety and security of all employees, clients, and customers during working hours. Any employee complaint can be potentially problematic, but some are far worse and more concerning than others. So then, when should an employer start a corporate investigation?

Attorney’s Services Are Too Costly

There are many reasons a business may need to outsource legal help. But hiring an expensive legal team can result in costs skyrocketing in a short period of time. Too much overspending can lead to a corporate investigation to target the cause of the money gauging before it bankrupts the entire company. Before hiring an attorney or legal team, make sure the business needs professional services and can actually afford them. Otherwise, you’ll be in more trouble down the line.

Concerns with Business Acquisitions

The right business acquisitions and mergers can ensure success for all businesses involved. But a lot of preplanning and disclosures need to be included or it can result in headaches or even an endless nightmare. A detailed corporate investigation can provide employers with a comprehensive Business Due Diligence Report that can answer any concerns on whether the acquisition or merger would be a worthwhile venture. This full report can cover many essential and perhaps deal-breaking details that may not otherwise be easily or willingly disclosed, including:

  • Business assets
  • Company profile
  • Current and former employees
  • Customer lists and information
  • Environmental concerns
  • Financial and property information
  • Parent company and subsidiaries

Fraud or Worker Incidents Are Apparent

Corporate investigations are often a result of company fraud or worker incidents. Various worker incidents can include harassment, injuries, and other safety concerns. In those situations, an outside party should always be called in to collect impartial details and handle the investigation. However, moreover, fraud is involved. According to the FBI, approximately 60% of employees admit they would steal from their employer if they knew they wouldn’t get caught. And according to Willis North America, employee theft is responsible for 90% of all significant business losses. An internal investigation can find the root cause of the loss, including:

  • Asset abuse
  • Bribery
  • Check and credit card fraud
  • Computer fraud
  • Contract fraud
  • Money laundering
  • Purchase fraud
  • Shell companies

Reported Employee Misconduct

Employee misconduct is one of the most common and most serious reasons an employer should start a corporate investigation. Misconduct can and often does include financial theft and monetary fraud issues. But it can also include any employee complaint or multiple complaints for other serious conduct concerns such as:

  • Bullying
  • Harassment of any kind, including physical, sexual, or verbal insubordination
  • Intimidation or threats
  • Substance abuse
  • Time theft

Avoiding starting a corporate investigation when the signs are present can be a serious and expensive mistake. Give us a call to connect with the right private investigator to avoid unnecessary headaches and reduce future employee complaints.