Covert Investigations
Prepare for Communications Hostilities Ahead

by Richard S. Levick

A dozen people residing adjacent to a new XYZ Corp. construction project have developed respiratory symptoms. As it is a polluted part of the slate, the symptoms could be attributed to many causes. But an NGO has posted a blog blaming XYZ. A front-page article in the local newspaper use the blog as a source and—when the NGO intensifies its attacks to include past accusations of Clean Air Act violations—the coverage only gets worse.

The GC advises the CEO to contact the NGO and ask to post a strong Statement affirming that there is absolutely no evidence of responsibility on XYZ’s part. In return, XYZ will, as a gesture of good faith, sponsor chest x-rays for anyone living or working within five miles of the site.

Very, very bad advice! The NGO accepts the offer—with surprising alacrity—and a lawsuit is filed two months later. The plaintiffs soon assert that the chest x-rays tire tantamount to an admission of liability. As a legal argument, that may not prevail, but the damage to the XYZ brand is potentially serious us the media starts asking: Is XYZ the kind of company that tries to buy its way out of responsibility?

The GC’s biggest mistake was his naiveté about his adversaries. He assumed them to be isolated do-gooders, and that their primary concern was actually the health and safety of area residents. Even though he performed basic due diligence, he did not discover a strong paper trail linking the NGO to the richest plaintiffs’ law firm in the region. In fact, had he moved beyond traditional research, he most likely would have uncovered monetary contributions to the NGO by the taw Arm.

With the right resources, including sources within the NGO. he may even have uncovered an extensive confidential strategic plan co-ventured by the NGO and the law firm. The plan specifically targets XYZ among other companies.

Hardly any GCs have the resources to mount such due diligence. Yet such resources are often precisely what are needed to protect corporate brands against the adversary’s covert resources.

A new breed of corporate investigators is now on the scene to provide just such resources. Their job is to tell you what you need to know about organizations, individuals, and other businesses that, for whatever reason, are out to harm you.

To understand the value of these professional investigations, understand their scope. The basics include:

• Is an attack on a corporation secretly funded by a competing corporation (or by a plaintiff’s firm as in our fictionalized example)?
• Does an attacker have a hidden personal animus against the company unrelated to die product or business practice under attack?
• Who is behind affiliated groups or sub-groups? Are they just shells contrived to make the adversary look stronger than is actually the case?
• Who are the principal players? Were they with an animal rights group yesterday and an environmental group today? If so, the same methods used in past campaigns against a laboratory may be used against your chemical company today.

Follow the linkages. You may discover enemies you never knew you had.

A Legitimate Enterprise

In our communications campaigns on behalf of businesses, we often see immediate need for uniquely trained professionals who protect brands by taking due diligence to the next level. At the very least, they are necessary to identify where the next attack will come from and how intense it’s likely to be.

It is wise practice to include such professionals on the crisis team alongside the CEO, the GC, outside counsel, the internal communications chief, and outside media/crisis counselors.

While there are covert dimensions to their work, the cloak-and-dagger component should not be overstated. The covert component is important, of course. It uncovers information that is not publicly available. And, it’s important simply because you don’t want your adversaries to know that you’re collecting information.  

But the confidential nature of these investigations does not make them any less legitimate a mechanism to protect business interests than legal strategies, insurance coverage, public relations, and lobbying campaigns.

It is especially important for general counsel to realize that this burgeoning cottage industry falls altogether on the safe side of the taw. It’s respectable work as well. Decades ago, when General Motors sent spies to dig up dirt on Ralph Nader, it cast a lasting pall on legitimate investigatory work. Bui there is no similarity between that debacle and the services that today’s qualified investigators provide.

The Nader example is particularly instructive, as good investigations do not focus on the prurient details of a subject’s life. In many cases, such stuff actually betrays a real laziness on the part of (he investigator who cannot uncover anything more substantive.

Team Member

Like any relationship, the corporate use of Investigators should be guided by a number of best practices, including:

• Even if these people advertise in the newspapers—although the better ones never do—it’s wise to hire them strictly on a referral basis. The industry is relatively unregulated and quality varies widely, from lone wolf gumshoes to sophisticated corporate intelligence firms. It is best to rely on validation by a trusted third party.
• The investigator will be an integral part of the crisis team. To ensure a harmonious collaboration, it’s best that your law firm or media firm, or both, have an existing relationship with the investigator.
• Establish in no uncertain terms what the investigators are supposed to achieve and how, in terms of techniques and resources, they will achieve it. Sometimes, their primary service is only consultative: to simply advise clients on the best ways to obtain information with the lowest amount of risk.
• It is often essential to establish from the get-go how the information will be used. In some venues, a confidential source is legally useless. But if it’s a media play, as would seem the case with our XYZ scenario, the barrier for entry is much lower and an array of off-the-record tips can be very useful.
• Don’t write a blank check. Even with the corporate brand at risk, there are reasonable budgetary controls and timelines that ought to be put in place.

Do not use investigators for matters that—like pre-transaction due diligence—can still be handled cost-effectively by the corporate staff. That said, some transactional matters are large and complex enough to require outside professionals.

In one real-life instance syndicating bank affirmed that due diligence had been conducted, An outside investigation found nothing more than a balance sheet based financial assessment Additionally compromising information was then uncovered, and the client was able to exit the deal without penalty because of the substantial misrepresentation.

Indeed, today’s investigators, in addition to protecting brands in the court of public opinion, are significant adjuncts to the legal team. For example, they provide powerful discovery weapons uncovering crucial data on their clients’ witnesses as well as opposing counsel’s. One need look no further than the Scrushy trial when powerful cross examinations, based on behind-the-scenes information-gathering, discredited the prosecution’s case with witness after witness.

Information is Power

With some of this information, the action points are obvious. Where sources are directly impugned, off-the-record tips to reporters can kill the story. If reporters feel leally tolled, alerting them to a tell-tale funding source or a personal vendetta can turn the tables as your adversary becomes the subject of subsequent exposes.

It gets trickier when the adversarial web is elaborate or when on ideological attack is subtly couched amid charges against specific products. Your strategy here can be two-pronged:

First, alert other industry representatives that a bread attack threatens their own interests. Create an industry-wide response that maximizes third-party support and paves the way for concerted action by, typically, a trade association

Second, develop a story about the attacker—its sophistication, its funding, its methodology—that neither mentions nor defends your own products or business practices. In other words, go on the offense with a totally fresh topic.

Corporate adversaries will continue to develop increasingly sophisticated strategies. Each new corporate scandal only further encourages the assault. The first absolutely essential objective of professional investigations is to find out who the enemy really is. Only then can a corporation know what it really has do.

Richard S. Levick, rlevick@levick.com, is President of Levick Strategic Communications, which has directed the media in the highest profile matters, from Napster and Guantanamo to the Catholic Church controversy and the Rosie O’Donnell Rosie magazine lawsuit Their latest books, Stop the Presses: The Litigation PR Desk Reference and 565 Marketing Meditations: Daily Lessons for Marketing & Communications Professionals, are available at Amazon.com.