There’s been a couple of articles written on what to look for when hiring a link builder, one was done by my good friend Justilien Gaspard and the other by Sugarrae. Both give excellent practical advice to follow if you’re hiring someone/firm to do your link work.
I won’t reguritate what they wrote but did want to add what I feel is an important issue especially since I watched it happen to someone I know.

Some link firms have big staffs, others, like myself, have 3 people. I can manage three people and my life but more importantly, I can be hands-on with the link work that comes in. That’s important because I’m the one that developed the marketing plan, closed the deal and has a reputation on the line.

When you’re hiring a link firm, ask about their support structure and who’s going to be handling your account. If a link builder is a one man show ( or any size for that matter) you need to ask how they’re going to do the detail work needed to successfully launch and follow up. If you find out they outsource – ask where. That’s important from a competitive standpoint more than anything.
If they’re sending your link work to another seo company, your privacy goes with it. Be sure to CYA (cover your ass) and get NDA’s (non-disclosure agreements). If the link firm balks at signing the NDA’s or assures you it will be “ok” stand firm and make the privacy point a deal breaker.
Your link marketing plan is a valuable piece of information and should only be seen by the people you contract to do your work. Don’t let it become a piece of informaton passed around assembly line style. Protect your competitive link assets.