Bank Worker Fired Under Strict FDIC Guidelines after Background Check Uncovers Minor Crime from 1963

The Des Moines Register reports a 68-year-old man in Iowa was fired from his job as customer service representative at Wells Fargo Home Mortgage after a background check uncovered a nearly half century old minor crime from 1963 listed as “fraud” in which he stuck a cardboard cutout of a dime in a washing machine. The story is the latest about bank workers being fired for minor criminal incidents in their distant pasts under strict new Federal Deposit Insurance Corporation (FDIC) guidelines for banking employment. The article is available here: ‘Wells Fargo fires Des Moines worker for laundromat incident 49 years ago’.

The Des Moines Register reports banks afraid of penalties are firing low-level employees since new federal banking and mortgage employment guidelines that forbid the employment of workers convicted of crimes involving dishonesty, breach of trust, or money laundering were issued in May 2011 in February 2012. Before the guidelines were changed – eliminating exceptions for expunged crimes and some minor offenses while expanding the number of employees covered – banks “interpreted the rules to exclude minor traffic offenses and some other misdemeanor arrests,” the Register reports.

The FDIC provides a waiver process for employees with past criminal convictions to show they are fit to work in the banking and mortgage industries but approval can take six months to a year. An automatic waiver is quicker but limited to workers sentenced to less than one year of jail time and who never spent time in jail. The fired worker in Des Moines, who was jailed two days, does not qualify. The Register reports the tighter FDIC guidelines have produced a “significant increase” in waiver applications – a 252 percent rise since 2009 –and may indicate an increase in bank firings due to criminal background checks.

As reported earlier in the ESR News blog, a similar firing of a 58-year-old woman – who also worked in customer service for Wells Fargo Home Mortgage – occurred in Milwaukee, Wisconsin after a background check uncovered two 40-year-old shoplifting arrests from 1972 when she was 18.  The Milwaukee Journal Sentinel reported the woman admitted she stole clothing from a department store twice, was fined $50 for the first incident, and placed on one year of probation for the second. When the woman applied for the Wells Fargo job, she recalled being asked only if she had any felonies in her past.

However, safe hiring expert Attorney Lester Rosen says some news stories about the recent firings of bank employees due to criminal pasts fail to tell the entire story since there are two avenues that allow job applicants and employees with minor offenses to work at banks. “Some news reports about these bank firings have sensationalized this story while giving the false impression that there are no avenues for recourse by not mentioning the de minimis exclusion or the waiver process,” says Rosen, Founder and CEO of background check firm Employment Screening Resources (ESR).

The ‘FDIC STATEMENT OF POLICY FOR SECTION 19 OF THE FDI ACT’ prohibits, without the prior written consent of the FDIC, a person convicted of any criminal offense involving dishonesty or breach of trust or money laundering from working at an insured depository institution. According to Rosen, the author of ‘The Safe Hiring Manual,’ Section 19 also contains a ‘de minimis’ exclusion and the opportunity to apply for a waiver. “The problem is this is a complicated area of law and regulations, and emotion-based stories that leave false impressions do not help the general public understand these issues,” Rosen says.

For more information about pre-employment background checks as part of a Safe Hiring Program (SHP), visit Employment Screening Resources (ESR) – ‘The Background Check Authority’ and nationwide background screening firm accredited by the National Association of Professional Background Screeners (NAPBS) – at http://www.esrcheck.com, call 415.898.0044, or email customerservice@esrcheck.com.

Sources:
http://www.desmoinesregister.com/article/20120827/BUSINESS/120827016/Wells-Fargo-fires-Des-Moines-worker-for-laundromat-incident-49-years-ago
http://www.esrcheck.com/wordpress/2012/05/09/news-reports-about-bank-firing-employee-for-40-year-old-shoplifting-charge-do-not-tell-entire-story/.
http://www.jsonline.com/news/milwaukee/will-your-employer-dig-up-your-arrest-40-years-ago-0059578-150316185.html
http://www.fdic.gov/regulations/laws/rules/5000-1300.html

About Employment Screening Resources (ESR):

Founded by safe hiring expert Attorney Les Rosen in 1997, Employment Screening Resources (ESR) – ‘The Background Check AuthoritySM’– provides accurate and actionable information that empowers employers to make informed hiring decisions for the benefit of their organizations, employees, and the public. CEO Rosen literally wrote the book on background checks with “The Safe Hiring Manual” and ESR is accredited by The National Association of Professional Background Screeners (NAPBS), a distinction held by a small percent of screening firms. Employers choosing ESR know they have selected an agency meeting the highest industry standards. To learn more, visit http://www.esrcheck.com/, call 888.999.4474, or email customerservice@esrcheck.com.

About ESR News:

The Employment Screening Resources (ESR) News blog – ESR News – provides employment screening information for employers, recruiters, and jobseekers on a variety of topics including credit reports, criminal records, data privacy, discrimination, E-Verify, jobs reports, legal updates, negligent hiring, workplace violence, and use of search engines and social network sites for background checks. For more information about ESR News or to send comments or questions, please email ESR News Editor Thomas Ahearn at tahearn@esrcheck.com.