Though many of the strategies and tactics employed to shelter assets from potential loss, due to litigation, are totally legitimate, and have been used by Fortune 500 corporations for decades, there is one in the grey area: it is the so-called friendly lawsuit, a technique that I find unethical and generally a fraud.
In the friendly lawsuit, an "adversary," under the direction of counsel for the company that is seeking protection from possible future creditors, sues the client, whose then stipulates to a judgement, ostensibly for damages. The judgment is recorded, and a Writ of Execution is issued, which means that any future judgment creditor's claim is behind the friendly judgment. This tends to discourages attorneys from pursuing the defendant, for any assets located an seized will only be sold to pay off the bogus judgment holder. It's an effective maneuver, but it does have a fatal flaw; if there is no factual basis for the friendly judgment, it can be set aside and cancelled, as fraud upon other creditors.
Most lawyers, acting for subsequent creditors, unfortunately never look beneath the four corners of the recorded judgment. This is an error, for additional queries, such as examining the case docket, and the court file itself, could reveal the bogus nature of the judgment.
How does this relate to compliance ? Any new corporate customer, seeking to open a business account relationship, especially those that contemplate high volume, should be the subject to a judgment search, in your local county's official records database. If any large judgments are displayed, and there is no satisfaction of judgment also recorded, that means the judgment is unpaid and unsatisfied. Check the court docket to insure that there actually was a contested action, with discovery taken, and an adversarial battle, before a judgment was entered. Otherwise, you may be looking at a friendly judgment, and a possible fraudster looking to become a bank customer.
Corporate fraudsters can commit damage to your bank, and they are to be denied access at all costs. As the gatekeeper, you must pass on such potential fraudsters, such as those you find through this method.