Monday, August 13, 2007

Due Diligence

What is Due Diligence?

Due Diligence (DD) is a
process whereby an investor investigates the attractiveness of an opportunity
and assesses the quality of the management team and the key risks associated
with the opportunity. It is a Way of verifying the validity of a particular
program’s real investment opportunities. It helps to discover everything
about particular program’s real investment opportunity before you invest
your money.

Due diligence is probably the most critical stage in investment. It is a complete
investigation and review of the investment opportunity.

When to Start the Due Diligence?

The investigation process
begins the moment opportunity becomes of interest to you. Your goal is to make
certain that you uncover everything about a particular program’s real
investment opportunities before you invest in it. You don’t have to meet
the company’s staff or even visit the business for your research to begin.
The Internet is an incredible tool that will allow you to investigate the validity
of a particular program.

Here are Due Diligence steps to follow before investing in any program:

1. Check out a program’s

The first step you should
do is to check out a program’s website. Carefully investigate its website

Some of the things you will see on scammer’s website are: Not professionally
designed website, Old templates with a standard collection of FAQ (Frequently
Asked Questions), Unorganized and Irrelevant website navigation, offering unrealistic
daily return, Poor security website, Continuous failing website, No actual names
and contact details and cheap scripts

2. Way Back: Investigate
how a website looked in the past

Way back machine is one
of the most important tools that are used to investigate how a website looked
in the past.

Some Scammers claim that they have been online for long time. Using Way Back
Machine you can easily identify if the website has been online for long time.
Way Back Machine has 50 billion web pages archived since 1996.

To investigate if they have been online for long time, Visit

Type in the web address
of a site or page where you would like to start, and press enter. Then select
from the archived dates available. The resulting pages point to other archived
pages at as close a date as possible. You will be shown the search results for
your particular website, categorized by year.

Just see if the contents of the website at different times match. Also focus
for contact details and see if they match.

3. Make Research on Forums
and Monitoring Sites

Another tool for making
a Due Diligence is Forums. Forums are a great place to exchange ideas with people
who have the same interest with you. There fore, as a research tool, you have
to visit known, popular, trusted and professional forums, like HYIP Discussion
and Golden Talk and, read what people are saying about the particular program.

Monitoring Sites are other Due Diligence tools where you can make your Investigation.
But there are certain issues you should be aware of monitoring sites.

a) Do not depend on a single
monitoring site

b) HYIP admins treat monitoring sites very well. Therefore, if you see paying
status on monitoring site, it does not mean the HYIP is paying all investors.

c) Read all rating given by the investors on the program you are making research.

4. Check WHOIS information: Domain registration data of a company’s website

Check the domain registration
data of a company’s website. WHOIS information gives you full information
about the company including telephone number. You can use either of these sites
to find the WHOIS information:

Type in the web address
of a site or page where you would like to get information, and press enter.
A complete list of contact details will be displayed on your screen. Some of
the information you will see on the screen are: Domain Name, Expiration Date,
Creation Date, Last Update Date, Registrant, Administrative Contact, Technical
Contact, Registration Service Provider, Registrar of Record, Record last updated
and Record expires, Record created and Domain servers in listed order

Once you get the WHOIS Data You should investigate carefully the dates of domain
registration and expiration. If the company claims that they have been working
online for long time, but their website domain was registered only few months
ago, it is just an indication of dishonest. At the same time, if the company’s
offers a long term plan and the domain registration expires in the near future,
the probability of company being a scammer is great.

Finally, just give a call to the number specified in the WHOIS data and make
sure that the contact details really belongs to the person listed in the WHOIS

5. Request the company’s

It is always recommended to request and investigate the company’s documents,
before proceeding with an investment.

You need to request and verify the following documents:

• Valid Business Registration Certificate,

• Financial Records,

• List of banks with which the Company has a financial relationship.

6. Confirm the validity
of the Company’s documents

At the final stage of your
Due Diligence you should confirm the validity of the documents requested from
the company. This is carried out by contacting the issuing institution.

In conclusion, there is always a risk associated with High Yield Investment
Programs. These risks are minimized by implementing proven and effective strategies.

To find out more about investment strategies, Visit
HYIP Strategies

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