Due Diligence and Parody of Reasoning II
Due Diligence should be thought of as checklist, or audit, or series of steps to verify facts about business opportunities for sale. Fraud can be avoided with by using serious due dilgence, or fraud can be courted using a parody of due diligence. As an example of the latter, I offer the following example:
There is a little outfit on the net purporting to perform due diligence on "program", high yield, autosurf, and like "programs". This forum, in September of 2005, announced their results of their "due dilgence" on 12daily Pro. The results are fascinating.
The announcement that 12daily Pro has passed OIC's first due diligence is here. The post runs for some 32 pages, as of March 8, 2006.
The actual due diligence is here. In effect, the gentlemen at OIC have determined someone answers the phone at 12daily Pro's landline, there are addresses on file from the whois directory, lifeclicks is an incorporated company, and there is some information on the net about Charis Johnson. Why is any of this at all convincing - given that on its face, the information is trivial?
Well, here is a related observation. The due diligence involved for purchasing a franchise involves reviewing a disclosure document, known in the US as a Uniform Franchise Offering Ciruclar, or UFOC. Right on the front page is the standard warning from the state regulator: "To protect you, we have required the franchisor to give you this information. We haven't checked it and we don't know if it is correct." (emphasis in the original.) (Here is an example of a UFOC.)
But because the document appears to be "from" the Federal Trade Commission, franchisees don't bother checking the information against the facts- despite being explicitly told to do so by the Federal Trade Commission. I kid you not.
Now we see why all these official lentries are part of the OIC due diligence - they add substance to an otherwise absurd program. "Look, there are all these official entries which must be something. Why look also, the state of North Carolina has approved of Lifeclicks! Look at all of those official whois requests." Thus, the scam takes on legitimacy through the mere association with credible authorities.
Comments
Hi I'm the one of 12dailypro member, I've been reviewed your articles about 12dp and I it's good, please keep Inform us about 12dp case, I really or we really wanna know how this situation will end, and i hope we will have happy ending for Lifeclicks.
Posted by: Chandra S. | March 11, 2006 9:56 AM