Stringent compliance obligations for the banking and finance industry mean it is imperative to implement rigorous employee background screening when hiring.
As illustrated by recent high profile cases, falsification of employment history is a growing issue across a range of industries. One solution is to use a background checking company, a provider of comprehensive employment screening services. These services bring a rigour to the recruitment process that can be instrumental in overcoming shortcomings in hiring practices which result in inadequate due diligence and screening processes. Embellishment of the facts is a key source of falsification, as revealed by research of more than 1,000 adverse findings of verification of employees moving to new jobs in the 12 months to 30 June 2014.
The data shows Australians are providing misleading information, with the top four adverse findings relating to previous employment (27 per cent), entitlement to work (26 per cent), professional memberships (12 per cent) and claimed academic qualifications (11 per cent). The best way for employers to address the risk of embellished resumes and other false claims is to adopt a robust pre-employment screening process. Paper certified copies of identification are the backbone of the human resource and recruitment industry. Yet the original identification documents used to conduct a 100 point check are not matched against a reliable source or database to guard against falsification. Without thorough checking against the data source to identify the person, the window is open for fraudulent activities to take place.
The risks to banking and finance organisations
The risks associated with inadequate due diligence can far outweigh the costs of establishing a robust employee screening process. Since the implementation of financial reforms in 2002 under the Corporations Act, a criminal check is required for new employees in the financial services industry. This is mandated due to the high risk to the organisation if a new employee is hired without discovering past criminal convictions such as fraud. A criminal check uncovers a range of convictions for drug usage, theft, breaking and entering and fraud. Verify delivers a comprehensive range of candidate background verification checks and services, with more than 100 checks available to help ensure employees have the appropriate qualifications, work history, licences, permits and background to perform their role. Employment risk mitigation is no longer recommended just when hiring. Periodic checks should become part of an organisation’s ongoing due diligence process to confirm employees’ licences are current and their criminal, work rights or financial status have not changed.
Ensuring background checks are screened
Referees can be readily falsified and, in the absence of proper screening processes, organisations can make hiring decision errors. There is a clear need for organisations to conduct due diligence and explore beyond referees to verify a person’s role. Referees also need to be confirmed by previous employers’ HR and payroll departments. Specialists can perform background checks over and above references to confirm an individual’s employment and other items such as work rights and qualifications. For an executive hire, organisations should conduct an average of eight to 10 checks. HR and recruitment companies are often unable to carry out all of the necessary checks due to problems accessing the data and/or the time involved contacting each department (for example, police, credit, licence, identity, medicals and psychometric assessments). These checks can take weeks to set up, perform and obtain results. Speed and efficiency are two key qualities required in a sound employee background screening service. Find a service that is not only comprehensive but also offer quick turnaround. eg. checks that can be turned around within one to three days from receipt of consent. It is important for this process to be thorough and non-invasive for the candidate and the employer.
Source: Australian Banking and Finance, and AB+F : https://zurl.co/6JAkn
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