A Lesson from Wall Street, Always do a Background Check…

by dbryant 11/3/2008 4:31:00 PM

Following the fund fraud cases of Tom Petters for the past few weeks leads businesses on Wall Street to a very hard reality: charm is not an indication of trust, it’s an illusion. As noted today in his home state’s Star Tribune, ‘a simple background check would have raised thickets of red flags.’ The effects of the fraud came just in time for the stock market decline and a strained economy.


Petters sits in jail for one of the most long-lived money laundering schemes in history.  As owner of Polariod and Sun Country Airlines as well as partners in several hedge funds and banks that never thought to conduct a background check on him, Petters’ scheme crushed a worldwide enterprise of star players in the marketplace.


Now his employees and partners are experiencing the worst of their nightmares: dissolving businesses and bankruptcies. Fortunately, some firms, like Bookbinder Capital Management, were smart enough to hire a background check firm to look into his past and present before investing in his faltering empire.


A lesson for all big and small business: don’t even think about risking your business to a big player who walks through the door with a portfolio of treasures without first investigating.  It’s people like Tom Petters that ultimately cause the decline in American prosperity.


As we are learning more and more every day, background checks are a necessity at every level of business and society. The Petters case didn’t just affect the big moguls, it trickled down to the employee that struggles every day to support a family. And, in this economy, what a time it is to lose a job.

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State and Criminal Database Background Checks: Are they Danger for your Business?

by dbryant 10/15/2008 9:37:00 AM

The ABC News report yesterday raises concern about the widespread use of criminal databases for background checks on job applicants. Numerous employers are being sued over hiring decisions based on inaccurate criminal records found in database searches.


Employers who are using criminal databases in place of county criminal records could be hiring a criminal without knowing it or rejecting employment to a talented candidate who truly doesn’t have a criminal record but a faulty background check indicated a crime. Either case could cripple a business with bad publicity and lawsuits.


Many employers use state or public criminal databases because they are less expensive than comprehensive background checks that include county criminal record searches. However, county criminal searches provide the most accurate and up to date information. These records are hand-pulled from court houses in the areas where the applicant lived, which is determined by a Social Security trace. County criminal record searches are considered best practices and ensure due diligence and FCRA compliance.


An article published by BRB Publications stresses that statewide criminal record repositories (databases) are used widely by many employers and licensing boards and that “this can be a dangerous practice.” Criminal record repositories have inconsistent updating times, low levels of quality control, backlogging of records, and lack of timeliness in receiving arrest and disposition data.


In the cases of the ABC News report, the use of mass produced compilations of criminal records is even more dangerous. A person with no criminal history who has the same name of another person with a criminal record could be denied employment. A decision such as this could not only detrimentally affect a business, but also a person’s life.


Employers have an obligation to take every step necessary to ensure they are using best practices when conducting background checks…both for the safety of the workplace and integrity in hiring policies. Employers are encouraged to outsource background check services to firms that do not compile or sell consumer data nor advocate the exclusive use of database searches for background checks.


Pre-employ.com and MyBackgroundCheck.com have always recommended against criminal database searches unless criminal hits are backed up by county criminal records. Both companies also provide a dispute resolution process for applicants who find inaccurate information on their background checks. Please visit the websites for informative resources and articles for consumers and employers about background checks and other important workplace issues.

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Background Check Company, Pre-employ.com, Voted "Best Employer"

by Admin 6/1/2008 8:48:00 PM

Pre-Employ.com, a leading national background screening firm, was recently named the "best large company to work for" in northern California’s Shasta County, an area known for its outdoor recreation, quality of life and affordable housing.

 

Pre-Employ.com received the annual award given by the SMART Business Resource Center, based on nominations submitted by some of Pre-Employ’s 150 employees. They lauded the firm for its medical and dental insurance, 401(k) retirement plan, work environment and other benefits, including a company pre-school and free health club memberships.

 

For more information, visit www.pre-employ.com or view full article here: http://www.pre-employ.com/details.aspx?id=f26

We welcome relevant comments, questions or suggestions from HR professionals, consumers and experts. All comments are reviewed before posting.

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