Comprehensive Due Diligence Helped Educational Institution Assess Reputational Risk Linked to Wealthy Donor

Background & Challenges

A prominent educational institution was approached by a wealthy donor wanting to make a significant contribution to the institution likely resulting in the donor’s name featured prominently in the institution in the form of a building or other monument. The institution wanted to conduct due diligence on the subject, his source of wealth, and understand any concerns of bribery & corruption, sanctions, and regulatory issues related to the subject and the immediate family. The concern was to not expose the institution to an unwanted association.

Approach

BDO conducted a thorough background profile on the subject, including a timeline of his wealth and connections through multiple sources. While focus was on records in the United States, ultimately international sources were obtained. Numerous adverse findings were identified to include a Swiss money laundering conviction, a negative association with international military dictators, as well as a connection to a U.S. based scandal in which a network of secretive banks and offshore tax havens were used to funnel bribes to an international official in exchange for construction and engineering work.

Client Impact

The client evaluated BDO’s findings and its impact on the institution which it was required to deliver to the Dean and Trustees appraising their reputational risk. The information presented from BDO’s comprehensive due diligence resulted in a hold of the financial contribution until further notice.