DUE DILIGENCE IN AN OPEN MARKET

Transcription

1 DUE DILIGENCE IN AN OPEN MARKET

2 PANELIST BIOGRAPHIES A n t h o ny J. C a m p a n e l l i, Pa r t n e r, D e l o i tte F i n a n c i a l A d v i s o r y S e r v i c e s L L P H a s m o r e t h a n 1 6 y e a r s o f e x p e r i e n c e i n c o n s u l t i n g o n s e c u r i t i e s l i t i g a t i o n, f o r e n s i c a c c o u n t i n g, f r a u d i n v e s t i g a t i o n s, a n t i - c o r r u p t i o n i n v e s t i g a t i o n s, a u d i t s o f G l o b a l S E C r e g i s t r a n t s. S p e c i a l i z e s i n f o r e n s i c a n d l i t i g a t i o n s u p p o r t s e r v i c e s i n t h e h o s p i t a l i t y s e c t o r. H a s b e e n q u o t e d i n T h e N e w Y o r k T i m e s, T h o m s o n R e u t e r s, a n d H o t e l I n t e r a c t i v e o n v a r i o u s f r a u d, e n v i r o n m e n t a l, a n d c o m p l i a n c e i s s u e s i m p a c t i n g t h e h o s p i t a l i t y i n d u s t r y H e i s a C e r t i f i e d P u b l i c A c c o u n t a n t ( C P A ), C e r t i f i e d i n F i n a n c i a l F o r e n s i c s ( C F F ), a n d C h a r t e r e d G l o b a l M a n a g e m e n t A c c o u n t a n t ( C G M A ) Ve r o n i q u e L a n t h i e r, V i c e P r e s i d e nt a n d S e n i o r C o u n s e l, M a r r i o tt I n t e r n a t i o n a l I n c. P r o v i d e s l e g a l s u p p o r t f o r t h e i n t e r n a t i o n a l l o d g i n g o p e r a t i o n s d i v i s i o n o f M a r r i o t t I n t e r n a t i o n a l, l e g a l s e r v i c e s t o h o t e l s i n E u r o p e, t h e M i d d l e E a s t a n d A f r i c a, a n d l e g a l s u p p o r t t o M a r r i o t t e n t i t i e s a n d M a r r i o t t - b r a n d e d h o t e l s w i t h i n t h e s e r e g i o n s S p e c i a l i z e s i n a v a r i e t y o f c o m p l i a n c e r e l a t e d s u b j e c t m a t t e r a r e a s i n c l u d i n g t h e F o r e i g n C o r r u p t P r a c t i c e s A c t, e c o n o m i c s a n c t i o n s r e g u l a t i o n s a n d c o m p e t i t i o n l a w. H a s a J. D. f r o m S t a n f o r d L a w S c h o o l a n d a M a s t e r s i n I n t e r n a t i o n a l R e l a t i o n s a n d E c o n o m i c s f r o m J o h n s H o p k i n s S c h o o l o f A d v a n c e d I n t e r n a t i o n a l S t u d i e s

3 PANELIST BIOGRAPHIES L i s a D a n e, D i r e c tor, D e l o i t te F i n a n c i a l A d v i s o r y S e r v i c e s L L P L i s a h a s o v e r 2 0 y e a r s o f e x p e r i e n c e i n t h e f i e l d o f c o n d u c t i n g l a r g e - s c a l e d o m e s t i c a n d i n t e r n a t i o n a l f r a u d i n v e s t i g a t i o n s, a s s e t t r a c i n g i n v e s t i g a t i o n s, l i t i g a t i o n s u p p o r t m a t t e r s, a n d d u e d i l i g e n c e a n d b u s i n e s s i n t e l l i g e n c e i n v e s t i g a t i o n s f o r l a w f i r m s a n d m u l t i - n a t i o n a l o r g a n i z a t i o n s w o r l d w i d e. H e r w o r k h a s i n c l u d e d g l o b a l i n v e s t i g a t i o n s f o r g o v e r n m e n t a l a g e n c i e s r e g a r d i n g f r a u d, b r i b e r y, a n d s a n c t i o n s a b u s e ; l o c a t i n g h i d d e n a s s e t s t o s a t i s f y j u d g m e n t s i n l e g a l m a t t e r s ; a d v i s i n g c o r p o r a t i o n s w i t h i n t e r n a l f r a u d i n v e s t i g a t i o n s b o t h d o m e s t i c a l l y a n d a b r o a d ; a n d i n v e s t i g a t i n g t h e b a c k g r o u n d s a n d r e p u t a t i o n s o f e n t i t i e s a n d k e y m a n a g e m e n t i n s e n s i t i v e p r e - t r a n s a c t i o n s i t u a t i o n s

4 What is Development Risk and why is it important to understand such risk today?

5 What are leading practices for screening potential owners for anti-corruption risk prior to conducting due diligence

6 What is owner/franchisee due diligence and how would you go about achieving: Risk assessment Questionnaires Diligence scope Source inquiries How do you gauge different levels of diligence based on the ownership structure?

7 What are some red-flags in the diligence process?

8 How do you respond to challenges: Missing information in questionnaires Adverse information about the owners and related shareholders/directors Government ownership Reputation risk

9 What is the value of performing Source Inquiry due diligence.

10 How would you assess each of these findings and would you recommend as next steps: Research identified a report from a non-governmental organization with a focus on anti-corruption efforts which stated that the Subject s Chairman had allegedly orchestrated efforts to embezzle assets from his organization and detailed the manner in which he attempted to cover up the fraud. Research identified a number of articles posted on the internet reporting that the partner s CEO had allegedly previously been detained on charges of embezzling funds from a company s former subsidiary. Research of litigation records did not identify any formal charges brought against the CEO and no additional details were identified in media or internet reports. Research identified an article stating that the CEO had received permission from the local authority to extend a hotel already under construction with the condition that it must carry the client s brand. The article also cited preferential treatment adding that it was rumored that one of the council s members who supported the application was a relative of the CEO.