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Due diligence: Difference between revisions
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===What [[due diligence]] ''is''=== | ===What [[due diligence]] ''is''=== | ||
[[Due diligence]] is the process of seeking comfort from one’s [[contract|contractual]] service-providing counterparts — especially one’s [[custodian]]s, [[Clearing broker|clearer]]s and [[prime broker]]s — that they have a robust operational setup, staffed with well-motivated and enthusiastic [[subject matter expert]]s and connecting to competent [[sub-custodian]]s, [[service-provider]]s and [[agent]]s so that, notwithstanding the skillfully negotiated [[indemnities]], [[covenant]]s, [[representation]]s and [[warranty|warranties]] your [[legal eagles]] have | [[Due diligence]] is the process of seeking comfort from one’s [[contract|contractual]] service-providing counterparts — especially one’s [[custodian]]s, [[Clearing broker|clearer]]s and [[prime broker]]s — that they have a robust operational setup, staffed with well-motivated and enthusiastic [[subject matter expert]]s and connecting to competent [[sub-custodian]]s, [[service-provider]]s and [[agent]]s so that, notwithstanding the skillfully negotiated [[indemnities]], [[covenant]]s, [[representation]]s and [[warranty|warranties]] your [[legal eagles]] have extracted from them in the [[verbiage]], your counterparties are nonetheless is ''factually'' capable of carrying out their obligations. | ||
[[Due diligence]] thereby gives '''practical comfort''' that the legal obligations are worth the paper they’re written on. | [[Due diligence]] thereby gives '''practical comfort''' that the legal obligations are worth the paper they’re written on. | ||
[[Due diligence]] is about [[fact]]s, not [[law]]. | ''[[Due diligence]] is about [[fact]]s, not [[law]].'' | ||
===What [[due diligence]] is ''not''=== | ===What [[due diligence]] is ''not''=== | ||