How Can Records Searches Help You Vet Clients?

Building and maintaining a successful legal practice requires attracting and acquiring new clients. However, not all prospects are worth representing. One best practice is to have a well-defined intake process using thorough due diligence to vet clients. Doing so can eliminate surprises that would otherwise delay or derail a case.

As part of your due diligence, you will initially want to interview your law firm’s prospective clients to learn more about them and their reasons for seeking counsel. Your inquiry, however, shouldn’t stop there. You will then want to conduct a search of public, private and business records. Doing so can help you determine whether your client is telling the truth and potentially reveal important information they inadvertently, or purposefully, failed to mention about their case.

Part of being a prudent lawyer is making decisions that benefit your law practice while avoiding decisions that could cause harm, such as loss of billable time or ethics violations. Vetting clients is an important part of this decision-making process. For example, conflict checks ensure you have no conflicts of interest that would preclude you from representing a prospective client. Such checks are part of a lawyer’s ethical obligations. Failure to adequately check for conflicts could result in a malpractice claim. 

Conflicts checks are a pervasive practice among lawyers because they are spelled out in the ABA’s Model Rules of Professional Conduct. There are, however, other less obvious, yet important, reasons to vet clients.

• Confirm client identity: It may sound unnecessary, but you need to confirm your client is who they say they are. Confirming identity can require different steps, depending on the type of matter. If the prospect is asking you to represent their business, you need to confirm their relationship to the business, such as whether or not they are actually a member of an LLC. If the matter involves specific relationships to other individuals, as is the case in divorce and estate proceedings, you will need to verify these relationships.
• Assess character: You want to represent clients who are reputable and have integrity. Checking a client’s background for criminal convictions or past litigation could reveal red flags that could dissuade you from taking their case.
• Assess the prospect’s finances: Unless you are doing work pro bono, you anticipate getting paid for your time and representation. Whether the prospect is an individual or a business, reviewing public, private and business records such as lines, judgement and bankruptcy information will help you evaluate the prospective client. In addition, reviewing a prospective corporate client’s finances could point to clues regarding unscrupulous business practices.
• Uncover smoking guns: Nothing can derail a case like a so-called smoking gun. Such damning pieces of evidence often arise when working with a prospective client who is withholding the truth about their case. For example, there have been numerous incidents when a person’s publicly available social media content was used against them to dispute a claim. In the personal injury lawsuit Romano v. Steelcase, a worker fell out of an office chair and sustained “serious permanent” injury. She then sued the chair manufacturer. As part of discovery, the defense reviewed the plaintiff’s social media profiles and found public posts that contradicted the extent of her injuries, such as images of her outside of her home.

Lawyers can search public, private and business records during the intake process to vet their clients. While exhaustive Internet searches may retrieve some of this information, many records are not accessible via the Internet. Furthermore, information discovered on the Internet may not be the most up to date or comprehensive. You’ll want to do some additional digging using online applications that provide consolidated data records to ensure you are getting a comprehensive picture of your prospective client, such as:

• Confirming a prospect’s identity: A basic records search can confirm current and previous addresses, date of birth, phone numbers, email addresses and places of employment. Public, private and business records can also confirm the client’s relationships to other individuals, such as familial relationships, current and previous marriages and business associates.
• Gauging a prospect’s solvency: Bankruptcy filings, liens, evictions, foreclosures and history of litigation and judgements are all pertinent to painting a picture of a prospect’s financial situation. Record checks can also help identify assets, such as property deeds and vehicle registrations.
• Looking for red flags: Social media can be a treasure trove for attorneys seeking to vet a client’s character and to conduct an initial scan for major red flags. For personal injury or worker’s compensation claims, images can contradict the client’s characterization of the severity of their injuries. In criminal cases, clients might post text or video that implicates them in a crime. Activity on sites like Twitter or Facebook could reflect a propensity for perpetrating online harassment, thus tarnishing a prospect’s character.

Whether you’re wanting to conduct a basic conflicts check or dig deeper into your prospective client’s background and history, conducting your due diligence before officially engaging a client is an important part of the intake process.

Learn how TLOxp from TransUnion can provide access to public, private and business records to help you review your prospective clients.