All posts by Les Rosen

Increased need for employer due diligence

By Les Rosen, Employment Screening Resources

2010 Trends in Screening Trend Nine: Increased need for employer due diligence

Another impact of the recession is the likelihood of applicant fraud.  Fraudulent educational claims, or worthless diplomas from degree mills, are already familiar problem for employers, recruiters and HR professionals.  However, resume fraud took on an added urgency in 2009 with the advent of services that would actually create fake employment references from fake companies.  The service apparently even included a phone number that an employer could call in order to reach a service that in fact would verify the fake employment.  Although statistic are not yet available, anecdotally it appears that some job applicants have been willing to resort to these extreme and dishonest measures to gain an advantage in the job market. 

In the long run, worthless diplomas bought over the internet or scams to create manufactured past employment will probably be unsuccessful for the most part, provided that employers exercise some due diligence.  For fake education, a competent background firm will typically verify first if a school is legitimate.  If the school does not appear on accepted lists of accredited institution, then a screening firm can review lists of known diploma mills and scams.  Screening firms will also verify if the accreditation agency is for real, since fake schools have resorted to creating fake accreditation agencies.

In addition, pulling of a fake job reference is getting much more difficult.  A good background firm will not simply call the name and number provided by the applicant.  Professional screeners will typically independently establish if the past employer even existed, and locate a phone number independently of whatever number an applicant puts on their resume.  Employment Screening Resources, for example, goes through an extensive procedure to verify that each past employer is legitimate and does not accept the applicant provided phone number.

The bottom-line for employers in 2010 is taking extra caution to ensure you are hiring bona fide employees.

(Employment Screening Resources (ESR), a leading national online employment screening background firm, is releasing the ESR Third Annual Top Ten Trends in the Pre-Employment Background Screening Industry  for 2010. This is the Ninth of the ten trends ESR will be tracking in 2010.)

Off shoring IT jobs lead to dramatic increases in Data Breaches per survey

By Les Rosen, Employment Screening Resources

A recent survey quoted in Security Management Magazine demonstrates the risk to privacy and data protection when it comes to “off shoring.”  According to a new survey, of the firms that outsourced IT jobs to other counties, about half indicted that their security has been negatively impacted. And 61 percent indicated their company had experienced a data breach.  The study noted data breaches occurred in just 35 percent of the companies that do not send IT jobs outside of the U.S.  The story, and more information about the study,  is available at:  http://www.securitymanagement.com/article/outsourcing-risk-006564 

This survey naturally raises questions as to the safety of sending Personally Identifiable Information (PII) of American job applicants off shore in order to prepare background checks.  A group  called ConcernedCRA now has more than 120 screening firms that have signed on to a standard that opposes sending Personally Identifiable Information (PII) offshore beyond U.S. privacy laws to be processed.  See http://www.concernedcras.com/.  A bill was introduced into Congress in June 2009 that would limit the offshoring of data without notice in the financial sector.  A shocking undercover investigation by the BBC in 2009 showed just how easy it was to purchase PII from a call center in India. Of course, identity theft can occur in the U.S., but once data physically goes beyond U.S. privacy laws, consumers have less resources and recourses. 

Employment Screening Resources (ESR) does NOT send U. S. applicant information outside of the U.S. for processing.  ESR takes the position that once data leaves the U.S., the data is beyond the reach of U.S. privacy laws and there is no meaningful recourse for a U.S. consumer.  ESR does all processing and preparation in the U.S.  in order to protect applicants and employers.  In some countries, it is a well known fact that U.S. identities are stolen and used for identity theft.  As a practical matter, someone in the U.S. has no ability to hire a lawyer in a foreign country to pursue legal action or contact a foreign police authority to get any action taken.  The only exception is where ESR is asked to perform an international verification and the information resides outside of the U.S.  Even in that situation, ESR goes to great length to protect applicant data. 

The bottom-line:  Before selecting a screening firm determine if that firm is processing information outside of the U.S. The risk is significant, even if the off shore facility is wholly owned or a subsidiary of a U. S. firm. An employer needs to have a full understanding of how data and privacy is protected once it leaves the U.S., and what duty is owed to job applicants in terms of notice that their data is going abroard.

Screening expands beyond new employees to vendors and others on premises

By Les Rosen, Employment Screening Resources

2010 Trends in Screening Trend Eight:  Screening will expand beyond new employees to vendors and others on premises

This is another ongoing area that will heat up due to the recession. In a recovery period, employers typically turn to temporary employees before committing themselves to full-time hires.  However, under the legal doctrine of co-employment, an employer has exposure regardless of whether the worker is on the company payroll or being paid by a staffing firm. With lawsuits for negligent hiring on the rise, employers can still find themselves the target of negligent hiring by failing to supervise the hiring practices of their staffing vendors.  Temporary workers and vendors coming on premises have access to company property and can still create a risk of workplace violence, theft, or embezzlement.  New and additional resources are coming online in 2010 to help employers manage the screening of their vendors.

Another area where screening will expand is the availability of applicants to run their own background checks.  Applicants will have the ability to screen themselves as part of the job-hunting process in order to find out ahead of time if there is anything in the public records about them that is negative, and as a tool to get an employer’s attention. Of course, an employer must still exercise its own due diligence so that all applicants are treated in a similar fashion, but pre-screening may help applicants get noticed faster.  An area that has yet to establish itself is the continual screening of current workers periodically after they are hired.  As Employment Screening Resources (ESR) has noted in previous articles, there are still issues to be worked out before such a practice gains wide acceptance.

(Employment Screening Resources (ESR), a leading national online employment screening background firm, is releasing the ESR Third Annual Top Ten Trends in the Pre-Employment Background Screening Industry for 2010. This is the EIGHTH of the ten trends ESR will be tracking in 2010.)

How do thieves steal an identity

By ESR Staff

The Federal Trade Commission provides excellent resources on identity theft.  Here is an excerpt from their educational website at: http://www.ftc.gov/bcp/edu/microsites/idtheft/consumers/about-identity-theft.html#Whatdothievesdowithastolenidentity

How do thieves steal an identity? 

“Identity theft starts with the misuse of your personally identifying information such as your name and Social Security number, credit card numbers, or other financial account information. For identity thieves, this information is as good as gold.
Skilled identity thieves may use a variety of methods to get hold of your information, including:

  1. Dumpster Diving. They rummage through trash looking for bills or other paper with your personal information on it.
  2. Skimming. They steal credit/debit card numbers by using a special storage device when processing your card.
  3. Phishing. They pretend to be financial institutions or companies and send spam or pop-up messages to get you to reveal your personal information.
  4. Changing Your Address. They divert your billing statements to another location by completing a change of address form.
  5. Old-Fashioned Stealing. They steal wallets and purses; mail, including bank and credit card statements; pre-approved credit offers; and new checks or tax information. They steal personnel records, or bribe employees who have access.
  6. Pretexting.  They use false pretenses to obtain your personal information from financial institutions, telephone companies, and other sources.  For more information about pretexting, click here.” 

Keep in mind that many experts note that the majority of identity theft occurs from businesses.  Employment Screening Resources (ESR) will post additional information in the future on how to prevent and protect against identity theft.

E-Verify and other government background check requirements

By Les Rosen, Employment Screening Resources

2010 Trends in Screening Trend Seven:  E-Verify and other government background check requirements will grow

The government’s efforts to require employers to verify eligibly for employment gathered additional steam when the rules for the use of E-verify for federal contractors finally went into effect in 2009 after a number of false starts. The E-verify system utilizes databases administered by the Department of Homeland Security and Social Security Administration to verify a person’s eligibly for work in the United States. Private employers can still utilize the Form I-9 without using the federal E-verify program.  Yet it seems certain that with the ongoing discussions about the legal right to work in the U.S, it will only become a more important topic in the future. Individual states as well are involved in requiring employers to utilize the E-verify system.  Employment Screening Resources (ESR), is an authorized agent for E-Verify. 

In addition, there continues to be efforts at various levels of government to require fingerprinting particularly after an event hits the headlines where someone did something and a background check was not done.  Of course, fingerprinting is far from 100 percent accurate and it raises discrimination issues as well since the FBI records are unfiltered and may well contain data that cannot be used for employment purposes. 

As noted in trend number one:  Of course, it is interesting to note that nearly every time a legislator objects because there is too much screening, there is often a call by some other elected official for even more screening after it is revealed that some crime or offenses occurred where an inappropriate applicant was hired without a sufficient background check.  A listing of proposed legislation related to screening shows that legislators are both calling for increased privacy and protections for consumers at the same time they are introducing bills to increase background check requirements.

(Employment Screening Resources (ESR), a leading national online employment screening background firm, is releasing the  ESR Third Annual Top Ten Trends in the Pre-Employment Background Screening Industry for 2010. This is the SEVENTH of the ten trends ESR will be tracking in 2010.)

Increased technology and the end of paper and faxing for employment screening

By Les Rosen, Employment Screening Resources

2010 Trends in Screening Trend Six: 

With advances in database technology, and the general acceptance of the HR-xml standardization for database integrations, it appears that the use of paper and faxes is coming to an end.  Not that “Going Paperless” is exactly a new development. Employment Screening Resources, for instance, has offered a totally paperless background check solution to its clients since 2006.  However, integrations between background screening and other applications, such as Applicant Tracking Systems (ATS), or Human Resources Information Systems (HRIS) may have reached a tipping point, so that the adoption will be at a faster rate.

It can also help solve issues concerning date of birth. Because of laws that prohibit discrimination on the basis of age, some employers are hesitant to ask for date of birth.  That creates potential issues since background screening generally requires an applicant’s date of birth in order to establish identity during criminal searches.  However, the EEOC has made it clear that asking for date of birth is not prohibited, but should be approached carefully and requested in such a way that does not deter older applicants. With online system sensitive information such as a date of birth or social security number can be obtained directly from the applicant so that an employer is never in possession of that information pre-hire.

(Employment Screening Resources (ESR), a leading national online employment screening background firm, is releasing the ESR Third Annual Top Ten Trends in the Pre-Employment Background Screening Industry for 2010. This is the SIXTH of the ten trends ESR will be tracking in 2010.)

Lawsuits for use of Social Networking Sites for background Checks

By Les Rosen, Employment Screening Resources

2010 Trends in Screening — Trend Five:  Lawsuits for Use of Social Networking Sites for Background Checks

In past posts, Employment Screening Resources (ESR) has labeled the use of the internet and social networking sites as a hot topic.  In 2010 and onwards, it appears very likely that litigation over the use of these sites will be the hot topic.

One big issue of course is discrimination.  Applicants can bring a “failure to hire” lawsuit if the employer utilized information from a social networking site about their race, ethnicity, nationality, martial status, religious preference, age, etc.  Another issue yet to be decided is privacy. Even though the information is on the internet, strong arguments can be made that consumers have a reasonable expectation of privacy on websites where only friends are supposed to visit and the terms of use prohibit commercial exploitation. In addition, employers need to be careful about the use of legal off-duty conduct.  There are also issues as to authenticity and whether a site really refers to or belongs to an applicant.  Recruiters are also not immune from potential liability just because they are searching for “passive” candidates who may not know they are the victims of discrimination. 

As ESR has described in past articles, discrimination rules apply equally to recruiters.  And firms that use social network sites in a discriminatory fashion could find themselves in hot water if a recruiter spills the beans, or the recruiting practices results in a workforce that is statistically imbalanced. See:  http://www.esrcheck.com/wordpress/775/the-rush-to-source-candidates-from-internet-and-social-networking-sites-2

Stay tuned to the ESR blog for updated information.

(Employment Screening Resources (ESR), a leading national online employment screening background firm, is releasing the “Third Annual Top Ten Trends in the Pre-Employment Background Screening Industry” for 2010. This is the FIFTH of the ten trends ESR will be tracking in 2010.)

Statistics and employment screening background checks

By Les Rosen, Employment Screening Resources

In an article on background checks posted on  Workforce Management in January, 2010, it was suggested  that “Employment and criminal checks also do little to screen out those who commit fraud.”  The reason is that statistics from a  2008 report by the Association of Certified Fraud Examiners based on 959 cases of workplace fraud showed that  Only 7 percent of fraud perpetrators have prior convictions, and only 12 percent have been previously terminated by an employer for fraud-related conduct. 

This is a good demonstration on an often use quote about statistic:  “Do not put your faith in what statistics say until you have carefully considered what they do not say.”  

The article overlooks a critical fact that the use of screening keeps would be embezzlers out of a positions of trust where they handle finances in the first place.  Fraud professionals certainly recommend background checks because it is the first line of defense that keeps former embezzlers out of positions of trust in the first place. As professional screeners, Employment Screening Resources (ESR) has saved many organizations from hiring former embezzlers and thieves for positions of trust  involving finances. However, there is no way to measure the numbers of frauds that are averted due to background checks.  The argument in Workforce is  like arguing flu shots are worthless because people who get the flu shots may still gat a flu.  An accurate assessment of the viability of a tool needs to include what would have happened if the tool was not used.  

The article goes on to suggest that screening for criminal convictions may also be ineffective in reducing workplace violence. That is because, according to the article, contrary to popular belief, the majority of workplace violence incidents are not committed by new hires with criminal convictions. Instead, they result from robberies committed by perpetrators from outside the firm, according to the Bureau of Labor Statistics. 

The suggestion that because most workplace violence is external shows screening of applicants is ineffective is equally illogical.   Screening is used to screen the workforce.  Even if employee violence is not the major cause of workplace violence, it is still a  significant cause.   Experts agree that a common denominator behind many acts of workplace violence by employees is a prior history of violence. That is certainly not true 100% of the time, but it is significant factor. 

Suggesting screening is not effective because outsiders cause the majority crimes is like arguing that healthy habits are a waste of time because sometimes a healthy person comes down sick anyway. When there is an act of workplace violence that could have been prevented by screening that results in a lawsuit against an employer, it is doubtful that any jury will buy that argument suggested in the Workforce article.    To the injured worker, or the to the family of someone killed by an act of preventable workplace violence by an employee, the suggestion that screening is a waste of time will certain ring hallow. 

This argument brings to mind another quote about statistics: “Then there is the man who drowned crossing a stream with an average depth of six inches.” 

Once again, statistics can lead down a very wrong road.

The  Workplace article is at: http://www.workforce.com/archive/feature/26/21/11/index.php (may require sign-up and log-in)

For more information on why background checks are mission critical tool for employers, see www.ESRcheck.com

2010 trend on criminal databases

By Les Rosen, Employment Screening Resources

2010 Trends in Screening Trend Four: The battle over databases will continue – the latest wrinkle is the proliferation of cheap do-it-yourself websites and even iPhone apps

An ongoing area of controversy in the screening industry is the use of commercially assembled national multi jurisdictional databases. These databases are complied from numerous sources that will sell or make data available. By no means are these databases complete and accurate, nor up-to-date.  Some results do not provide any additional identifiers beyond the first and last name.  As a result, a great many criminals would come up as “clear.” This is called a “false negative.”  These databases are practically useless in states like New York and California, two large areas.  In Texas, the criminal data is also very hit and miss.

Conversely, databases can result in a person being labeled a criminal when they are not.  That is a “false positive. 

In the hands of a professional background screening firm, these databases have significant value as an additional but secondary tool that can lead to further places to search.  However, the downside is that some employers want the database information without doing court searches, meaning that some people will be falsely labeled as criminal when they are not and some people will be falsely cleared as having no criminal record when they do.

Under the FCRA, a screening firm has the option of reporting a database search without courthouse confirmation as long as the consumer gets a notice at the same time about the search. Over 120 background firms, however, and the State of California (by statute), have disavowed this approach.  See http://www.concernedcras.com/ 

Another fallout from these databases are consumer scams, where fly-by-night quick-buck artists have set up background checking sites that merely rehash old data at exorbitant prices.  And even worse, many of these sites do not make it crystal clear to employers that they must comply with the FCRA, or that the database results can be incomplete or inaccurate.

The latest twist is that these data searches are now offered over “smart phones. Given the problems with such data, it’s hard to see how someone on a date can really get much value from these database searches.  On the other hand, such applications have been labeled a must have for stalkers and sexual predators becsue these apps apparently include personal data such as address. 

One of the challenges facing the screening industry is to educate employers that these do-it-yourself sites are dangerous and can embroil an employer in all sorts of problems.  The problems can include lawsuits form applicants whose rights were violated, to victims whose injuries could have been prevented by a real background check. 

(Employment Screening Resources (ESR), a leading national online employment screening background firm, is releasing the ESR Third Annual Top Ten Trends in the Pre-Employment Background Screening Industry for 2010. This is the FOURTH of the ten trends ESR will be tracking in 2010.)