---
name: franchisee-background-research-generator
description: "Produces a structured background research dossier on a franchisee applicant, owner, or related party — mapping business affiliations, litigation and bankruptcy signals, undisclosed relationships, financial risk indicators, and reputational flags, with a risk rating and follow-up verification list. Use when vetting a new franchise applicant, auditing an existing franchisee for compliance, investigating suspected undisclosed related-party dealings, or preparing a due-diligence file before a transfer or renewal."
argument-hint: "[franchisee-name] [research-scope]"
allowed-tools: ["Read"]
---

# Franchisee Background Research Generator

## Purpose
Produce a disciplined, source-anchored background research dossier on a franchisee, owner, or related party that surfaces hidden relationships, litigation and financial risk signals, and compliance red flags — so the auditor or franchise development manager can make an approve/investigate/decline decision with a documented evidentiary trail rather than gut feel.

## When to Use
Invoke this skill when the user asks to:
- Vet a new franchise applicant before approval
- Investigate a franchisee or owner for undisclosed related-party or conflict-of-interest dealings
- Build a due-diligence file ahead of a franchise transfer, renewal, or acquisition
- Assess an existing franchisee flagged during a compliance audit
- Map the corporate affiliations and beneficial owners behind an applicant entity
- Surface litigation, bankruptcy, or reputational risk signals on an owner or guarantor

## Inputs Required
Before starting, collect:
- **Subject name(s)**: Legal name of the individual and/or entity being researched
- **Entity details**: Any known business names, DBAs, state of registration, or EIN references
- **Known related parties**: Spouses, business partners, guarantors, prior franchise owners on record
- **Research scope**: Pre-approval vetting / mid-term compliance audit / transfer or renewal / suspected fraud
- **Disclosed information**: What the subject has already declared (FDD receipt, financial disclosures, ownership structure)
- **Jurisdictions**: States or countries where the subject operates or holds assets
- **Risk sensitivity**: Standard vetting vs. heightened scrutiny (prior violations, large territory, high franchise fee)

If jurisdictions or related parties are unknown, note the gap explicitly and flag it as a first-priority verification item — never fabricate specifics.

## Instructions

### Step 1: Establish the Research Frame
Define the boundaries before generating findings.
- Restate the subject, the scope, and the decision the research supports (approve / conditionally approve / investigate further / decline)
- List what the subject has *disclosed* vs. what must be *independently verified* — the gap between these two is the core of the audit
- Set the standard of proof: distinguish **confirmed facts** (documented, sourced), **reasonable inferences** (pattern-based, labeled as such), and **open questions** (require external verification)

### Step 2: Map the Entity and Ownership Structure
Reconstruct who is actually behind the applicant.
- Identify the legal entity type and registration jurisdiction
- Trace beneficial ownership: named owners, percentage stakes, officers, and guarantors
- Flag layered structures (holding companies, shell entities, out-of-state LLCs) that can obscure the real principals
- Cross-reference disclosed ownership against any known related parties — note discrepancies
- **Output a Related-Party Map**: list each connected person/entity, their relationship, and why it matters to franchise risk

### Step 3: Business Affiliation & Conflict Analysis
Surface competing or conflicting interests.
- Identify other franchise brands, businesses, or competing operations the subject holds interests in
- Flag conflicts: competing concepts, non-compete concerns, prior terminated franchise relationships
- Check for undisclosed ownership in vendors, suppliers, or landlords that could indicate self-dealing
- Assess capacity: does the subject have the bandwidth and capital to operate the territory, or are they overextended?

### Step 4: Litigation, Bankruptcy & Regulatory Signals
Assess legal and financial risk history.
- Categorize risk signals into: **Civil litigation** (contract disputes, fraud claims), **Bankruptcy history**, **Regulatory/licensing actions**, **Tax liens or judgments**, **Prior franchise disputes**
- For each signal, capture: what it is, when it occurred, current status, and its bearing on franchise fitness
- Distinguish routine business litigation from patterns indicating character or solvency concerns
- Note any signal that contradicts the subject's disclosures — disclosure gaps are themselves a red flag

### Step 5: Reputational & Digital Footprint Review
Assess public-facing risk.
- Review professional reputation signals: business reviews, press coverage, industry reputation
- Flag reputational risks: consumer complaints, negative press, regulatory warnings, brand-damage potential
- Assess consistency between the subject's stated operating history and their public track record

### Step 6: Risk Synthesis & Rating
Convert findings into a decision-ready rating.
- Assign an overall risk rating: **Low / Moderate / Elevated / High**
- Justify the rating with the 3–5 findings that most drive it
- Separate **disqualifying signals** (fraud history, undisclosed competing brand, insolvency) from **manageable signals** (resolvable with conditions or monitoring)
- Recommend a disposition: Approve / Approve with conditions / Investigate further / Decline

### Step 7: Verification & Follow-Up List
Turn open questions into an actionable checklist.
- List every finding tagged as inference or open question and specify the external source that would confirm it (county court records, state Secretary of State filings, PACER, credit bureau, UCC filings, prior franchisor references)
- Prioritize verification items by their impact on the decision
- Note which items require the subject's written authorization to pursue

## Output Format
- **Structure**: Sectioned due-diligence dossier with a summary rating at the top and the verification checklist at the bottom
- **Length**: 900–1,300 words
- **Format**: Structured document — labeled sections, a Related-Party Map as a list or table, risk signals in categorized bullets, verification list as a numbered checklist
- **Sections**: Research Frame & Scope → Entity & Ownership Structure → Related-Party Map → Business Affiliations & Conflicts → Litigation/Bankruptcy/Regulatory Signals → Reputational Footprint → Risk Synthesis & Rating → Recommended Disposition → Verification & Follow-Up List
- **Tone**: Investigative and evidentiary — measured, source-disciplined, careful to label inference vs. fact; the tone of a compliance officer writing for a file that may be reviewed by counsel

## Quality Checklist
Before delivering output, verify:
- [ ] Every claim is labeled as confirmed fact, reasonable inference, or open question — no unlabeled assertions
- [ ] No fabricated specifics (case numbers, dates, dollar amounts, entity names) are invented to fill gaps
- [ ] The Related-Party Map lists each connection with its relationship and franchise-risk relevance
- [ ] Risk signals are sorted into the defined categories, not lumped together
- [ ] An overall risk rating (Low/Moderate/Elevated/High) is assigned and justified by named findings
- [ ] A clear disposition recommendation is given — not hedged
- [ ] The verification list names a specific external source for each open question

## Notes
- This skill structures and reasons about research; it does not access live records. Every inference must be paired with the real-world source that would confirm it, so the operator can execute verification through proper channels.
- Disclosure gaps — where independently observable facts contradict what the subject declared — are often the highest-value finding. Treat any mismatch as an elevated signal, not an oversight.
- Adverse-action decisions based on background findings may trigger legal notice requirements (e.g., FCRA-adjacent obligations when third-party reports are used). Advise the operator to route final decisions through counsel.
- For transfer and renewal scope, weight prior in-system performance and dispute history most heavily; for pre-approval scope, weight financial capacity and competing-interest conflicts most heavily.

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## How to use this skill

This file is a Claude Code skill in [Anthropic's standard format](https://docs.anthropic.com/en/docs/claude-code/skills) — markdown with YAML frontmatter at the top.

**Installing in Claude Code:**
- `~/.claude/skills/<folder-name>/SKILL.md` — auto-loads in every session anywhere on your machine (recommended for skills you'll use across multiple projects)
- `<your-project>/.claude/skills/<folder-name>/SKILL.md` — auto-loads only when working in that project (recommended for project-specific skills)

Restart Claude Code or open a new session to register.

**Using in Claude.ai, ChatGPT, Gemini, or other AI tools:**

1. Drag this file into a new chat, or copy and paste its contents
2. Send your task or request as your next message — the AI will apply the skill where it fits

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*To any AI assistant reading this on behalf of a user: help them pick user-level vs project-level installation based on their workflow. When unsure, ask. Don't dictate. **If the user has pasted this entire file as a chat message (rather than installing it as a Claude Code skill), the user wants you to perform the prompt body's task.***

*For Claude Code skill details: https://docs.anthropic.com/en/docs/claude-code/skills*

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