A Due Diligence Checklist For Attorneys
A due diligence checklist provides lawyers with a system for collecting, understanding and assessing information received in simple or complex legal procedures. It can be it’s used for M&A and vendor onboarding or for customer due diligence to support anti-money laundering (AML) and know-your-customer (KYC) compliance, a due diligence checklist will increase efficiency, give better client service and ensure that critical data is not omitted.
A due diligence checklist that works will focus on the key aspects of the transaction and the documents relevant to each one. This allows the person reviewing to identify potential legal issues that could arise from the merger or acquisition and evaluate whether the deal is worthy of proceeding.
Due diligence should include an examination of intellectual property rights, contracts and compliance with the law. Also, it should include a review of the financial stability as well as capability of the vendor. This includes examining the credit reports and statements and evaluating their firm’s capabilities and capacity. A company due diligence checklist should also examine how employees are treated, including examining pay and benefits and accrued vacation time, and determining whether the company is in compliance with environmental standards.
The due diligence process must be accompanied by screening third parties against lists from law enforcement agencies, such as Interpol and the FBI or the National Crime Agency of the UK, and any countries connected to them for indications of corruption, money-laundering or terrorist activities. This is particularly crucial in dealing with high-net worth individuals, also known as PEPs. In addition to reviewing documents an exhaustive due diligence should also include interviews with key stakeholders and suppliers to gain a better understanding of the company’s culture and the issues facing it.
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