Seriously, should we really have to do criminal background checks on all of our potential clients?
We were approached in June about doing what would have been our largest project to date. We should have just declined when we heard the words “social networking” and “non-disclosure agreement” in the same sentence because those meetings typically don’t turn into anything, but this was a referral from a friend of ours, so we felt obligated to hear these guys out. They had a good concept, seemed to know what they were talking about, and appeared to have some resources. One of them, known hereafter as Guy #1, had lots of marketing experience as well as connections in the target industry. The other, Guy #2, was more technical and had some connections of his own.
Now usually, with most of the projects we do, we can estimate the hours pretty closely based on our past experience. With this particular project though, there was a lot of stuff involved on the back end. These guys wanted to build a social site with some pretty complex functionality, and they had lots of ideas. We spent a good bit of time in meetings refining their concept and working out a more solid feature set so that we could give them an accurate price quote. After a couple rounds back and forth, we finally settled on a scope and budget everyone was happy with.
These guys scheduled meetings with their lawyer to review the contract and started pulling money together. Due to all of the people involved — their industry connections, financiers, and the bank — it took a while. They updated us every couple weeks to let us know where things stood. In September, they stopped by and said they would be ready to roll in another week or two.
That’s when things got weird. Guy #1 — the marketing guy — stopped answering emails and phone calls. We got in touch with Guy #2 and he said he couldn’t get in touch with his business partner either. After a couple weeks of this, Guy #2 finally emailed us and called things off. He said he did a little checking on the North Carolina Department of Corrections site and found out that Guy #1 had been in prison multiple times for fraud. Guy #1, this slick marketing guy, had apparently conned both Guy #2 and us. He allegedly (hey, they always say that on TV) took our cost estimate to the bank, got a loan, and disappeared with the cash. Guy #2 still wanted to do the project, but since he was depending on Guy #1 for financing, couldn’t afford to move forward on his own.
Needless to say, we were a little frustrated and confused since we were really looking forward to doing this particular project. Not being guys to let sleeping dogs lie, or maybe being guys who like to beat a dead horse, we decided to do a little research of our own. We confirmed that Guy #1 was in prison for fraud and was released this spring. We also found out that Guy #1 didn’t own a house in Wake County, although he seemed to be very well-off. Also, his business address turned out to be one of those “rent a mailbox” places. Guy #2 told us that he met Guy #1 about a year ago, but looking at the records, Guy #1 was admitted to prison about a year ago, so yeah, we took the next logical step and looked up Guy #2. We were shocked with what we found — both Guy #1 and Guy #2 had been in prison. Actually, they were both admitted to prison at the exact same facility on the exact same day, about a year ago. Maybe they met while standing in line to pick up their orange prison attire. It seems like Guy #2 would have found out why Guy #1 was in prison before deciding to go into business with him, because as they say, there is no honor among thieves. I guess he either didn’t ask or just trusted what he was told. Guy #2 was at least honest with us when we asked him about everything, so we think he’s just a stand-up guy who made a mistake in the past and is now trying to get his life back on track by starting his own business.
Three months ago, we would have never imagined that the two guys sitting in our office presenting a solid idea for a social networking site were both convicted felons who had just been released from prison. Looking back, there are a few things that might have tipped us off, but hindsight is always 20-20. Hopefully this is a one-time thing and we won’t have to start doing criminal background checks on every potential client who comes through the door.
Anyway, if anybody happens to have a large sum of money, we’ve got a big social networking site just waiting to be built…
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