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Reputational and integrity due diligence on COO candidate revealed practices of questionable integrity, character, and competence

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CRA’s Forensic Services experts were engaged by a publicly traded critical infrastructure sector company endeavoring to hire a new chief operating officer (COO). The company’s human resources team commissioned its “standard” background check, which did not identify any irregularities. However, given the seniority of the COO, and the fact the company was under significant legal pressure and regulatory scrutiny for major prior compliance failures, the general counsel retained us to conduct additional, privileged integrity due diligence on the candidate.

Our team identified multiple issues that raised questions about the candidate’s integrity, character, and competence—including blistering criticism from a bankruptcy administrator related to an unsuccessful attempt by the candidate to file for bankruptcy in order to avoid repaying a relocation bonus: “Debtors’ Chapter 7 case should be dismissed … either on the grounds that the case should be presumed to be an abuse of the [Code] … or upon any finding by the Court that the petition was filed in bad faith.” Our various findings allowed our client to move forward with an “eyes-wide-open” approach and enabled the CEO to front the issues with the Board.

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