Arrest Fraud: Prevent Workplace Theft With A Comprehensive Background Investigation Program

By Hart Brown, CORP, CBCP, CEH, CLCS, LPQ
Senior Vice President, Practice Leader, Organizational Resilience, HUB International Limited

Organizations lose as much as 5% of their revenue each year to fraud. For a small to mid-size business earning $50 million annually, that’s a staggering $2.5 million – an amount no business can afford to forgo.

A first step in preventing organizational fraud is screening employees and business partners. Whether you’re hiring a new employee, reviewing an employee for promotion to a greater position of trust or screening a potential new vendor or customer, the ability to conduct effective background research can reduce the risk of insider threats, fraud and improve productivity. 

More than just a basic online criminal check, a good background investigation program will be comprehensive, utilizing a combination of public and private databases, human intelligence and other screening technologies. It will investigate an individual’s identity and authentication, credit, criminal and employment history.

Identity and Authentication Check
Essential to an inclusive background check is the ability to validate the identity of applicants and ensure they are who they claim to be. By verifying true identity employers can proceed confidently with other background screening processes. Identity and authentication verifications should include:

     

  • Social Security Number (SSN) verification and trace
  • Addresses associated with the SSN  
  • Names associated with addresses  
  • Any aliases, maiden names, nicknames, etc. 

 

Credit History Check
An employment credit history report offers valuable insight into an applicant’s sense of fiscal responsibility, paying habits, financial track record and potential for an individual to consider theft as an option to solve personal obligations. This is especially important when the employee is being considered for a position of trust with access to critical accounts or financial processes. A credit history check should include:

     

  • Judgements and liens
  • Bankruptcies  
  • Accounts in collections 

Criminal History Check
A criminal records check is the cornerstone of most pre-employment background screening programs. The search includes of over 200 million records in 47 states, and when combined with a jurisdictional criminal history search, it assists in identifying applicants with risky criminal behavior. A criminal history check should include:

       

  • National, state-by-state and county criminal records
  • Department of Corrections and administrations of court records  
  • Interpol most wanted
  • Office of Foreign Assets Control blocked lists  
  • Sex offender registry 

It’s important to note that while federal law allows employers to conduct criminal history checks, Title VII of the Civil Rights Act of 1964, prohibits employers from treating individuals with similar criminal records differently if they are of a protected class; from screening individuals if it will put those of a certain class at a significant disadvantage; or the search outcome does not help the employer accurately decide if the potential employee is worthy of the job. Consult your risk services expert for more information.

Employment History Check
An employment check assists in establishing the individual’s work history in order to ensure job seekers are honest in their application. In addition, a reference check can be crucial in identifying potential concerns in the workplace. An employment history check should include:  

     

  • Dates of employment, job duties, salary and positions held verification
  • Seven-year employment verification  
  • Resume discrepancies  
  • Reference checks 

When Additional Services are Necessary
Additional screenings may be necessary based on the job tasks required, a business’ internal policies or even due to a red flag already uncovered about the applicant. Here’s a list of a few additional investigations that should be considered:

       

  • Drug screening  
  • Social media search  
  • Education verification  
  • Department of Motor Vehicle check  
  • Workers compensation claim check  
  • Employee suitability assessment  
  • International background check  

Build a Comprehensive Program with a Risk Services Expert
A comprehensive background investigation program can be most thorough and efficiently executed when conducted by a third-party risk services expert who can incorporate a business’ goals and objectives when developing a customized service plan with specific deliverables and timelines. Such a program has been demonstrated to reduce absenteeism, workers’ compensation claims, morale, employment issues and most importantly – workplace fraud.

About The Author:
Hart S. Brown, Vice President of Organizational Resilience for HUB International’s Risk Services Division, has nearly 20 years experience in security, crisis management, emergency management and business continuity.  A former Program Director for the US Department of State, Brown received an Award of Appreciation from President George W. Bush.   He is a widely published security expert and frequent contributor to HUB’s Crisis Management Center blog.

Source: hubinternational.com
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