Industry-Related Regulatory History Searches

Regulatory history searches can help determine an individual’s reputation in a particular industry.  SEC complaints, CFTC arbitrations, NYSE actions and state attorney general suits can end an investment decision quickly.  Confirming whether a person or business is properly licensed under federal, state and local law can affect insurance coverage or impose liability upon a company for retaining unlicensed persons.  Uncovering such information from the appropriate licensing and regulatory associations (governmental and non-governmental) has proven to be invaluable in the course of a due diligence investigation.

Case Examples:

We discovered a hedge fund manager had not registered his firm with the state bureau of securities.  After discussing the facts of his operation with the bureau, the bureau advised that the manager was required to register.  Upon learning this, our client confronted the manager and advised no investment would be made until all regulatory filings were completed or he produce an opinion letter from legal counsel confirming his claimed exemption.

We were asked to verify a medical license of a doctor who was to provide advisory services for a nursing home.  Upon speaking with the state Board of Medicine, we learned his license was suspended.  The Board did not provide any further information, however, a search of the federal court dockets for the state of licensure revealed a complaint against the doctor for fraudulently billing Medicaid.