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Business Background Checks

Feb 28, 2008
Checking the background of a business or company you intend establishing a relationship with or hiring is necessary to make sure the company has a good reputation, is licensed properly, and that there are no liens, judgments, bankruptcies or civil actions involving the company or its principles.

Step 1 - Confirm the Company Reputation

Community Resources
Valuable information can be derived in records maintained at the local community. Every business, except the multinational corporations, has its community roots and is in conformity to local laws and ordinances. The locality in which the business was established can be the main source of information about many businesses.

Civic or business groups like the Filipino-Chinese Chamber of Commerce and Industry can be one reliable source of about the firm you are probing. This is unless they are cooperative and will provide you with information.

Published Items
Widen your research by including articles about the firm and its principles in the community and national newspapers in your work.

Step 2 - Verify the Company's Reputation

Be sure to ask for references when you will be doing business with a company or hiring a company's service. Visit their office or call them up. Ask specific questions, converse with and you can derive good information. But the most reliable informants are their clients and former clients who can provide you the best picture of the company.

For some other references, the partners, suppliers, vendors, creditors and employees of the company can give further information.

Business Licensing
Every entity or individual who intend to do business in certain area is required to have license. So if you intend to contract its services, ask for business card. If the license number is not in the card, then verify it at the licensing office or at the Department of Trade and Industry.

Federal Employer Identification Number, FEIN
Just like each US citizen (and each person legally working in the USA) has an assigned Social Security Number (SSN), all US corporations have a Federal Government assigned number, it's called 'FEIN,' or Federal Employer Identification Number. It can be easily traced. Start at the local company level. Large corporations are a vast storehouse of public information.

Step 3 - Delve into the Background of Company and Principles

You may decide to conduct an even more in-depth investigation by checking the background activities of partners and owners. You want to know if there is any litigation against the company or the people who make the company decisions. Have they been sued and do records exist of resulting judgments and liens? An isolated instance or two may not indicate much, but a pattern of reoccurring litigation should be taken into serious consideration.

Court Records

Law Suites, Liens, Judgments, Bankruptcy Filings and Tax Liens
These records contain information pertaining to adjudication, assets, liens against business owners and principals. And tax liens. These records are mostly stored at the County Court, where the business is located. State Records contain UCC filings, information about liens, collateral, litigation, and judgments. Litigation instated by the government such as bankruptcy filings and tax liens are within the Federal Court System.

Criminal Records

Conduct a criminal history search on all principles. Records are kept on several levels and each entity and jurisdiction is unique as to access or availability, coverage, and how the records are indexed. County court records are the most in-depth of all criminal records. Department of Corrections (DOC) databases provide information on inmates both current and past. The Federal Prison System has information on those who have committed a federal crime. Include a search of sexual offender databases.

Important: criminal records are indexed by name and date of birth. This information is often misrepresented by people who are attempting to make it difficult to connect them to a record. Search databases by inputting all variations and aliases.

The OFAC's Patriot Act Search Database, made available a watch list, a combination of national and international databases.

Criminal Databases
There is no national government criminal database available to the public. Proprietary criminal databases are assembled and owned by Information Brokers. Records are obtained from a variety of sources.

The locality in which the business was established can be the main source of information about many businesses. Due diligence investigations by competent legal counsel can also verify some basic information like licenses, corporate filings, phone numbers etc.

Doing a Tenant background checks
A simple tenant screening can prevent potential problems for a landlord. Looking into a tenant's criminal record will more than likely keep a professional thief out of an apartment building, or a convicted sex offender, or any number of other dangerous or unpleasant criminal elements. An empty apartment is better than one wherein ythe landlord will potentially lose his business.
About the Author
Phoebe Wellington
is a writer for Background Check - SherlockRecords.com
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