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Androvett Blog

by Robert Tharp at 3:26:49 pm

With capital markets frozen, businesses finding it hard to ask tough questions of potential investors

With credit markets in deep freeze, lots of businesses out there are desperately seeking investors. And when a company's viability is hanging in the balance, it becomes harder and harder to look the gift horse in the mouth and ask the tough questions of a potential white knight. But such due diligence of investors is more important than ever, says attorney Cliff Risman of Gardere Wynne Sewell LLP. Risman notes that potential investors should be vetted by the State Department, Treasury Department and other governmental agencies, as well as through private investigation agencies. "Due diligence is critical, and this goes far beyond traditional reviews of business and financial fitness," he says. "Regardless of the domicile or nationality of the investor, care must be taken to be sure the funds are not the proceeds of some form of illegal enterprise and that the investor is not on any of the various terrorism or other watch lists." To interview Mr. Risman, contact Rhonda Reddick at 800-559-4534 or rhonda@androvett.com.