COVID-19 Update: Despite court closures in many areas, Sterling is still able to complete criminal checks with minimal disruption thanks to our proprietary end-to-end automation that allows us to access court information. For additional info on how Sterling is handling the COVID-19 situation, please visit our COVID-19 page.

August 8th, 2016 | Sterling

Rinse and Repeat: Re-Screening as Part of Your Hiring and Retention Procedures

Rinse and Repeat: Re-Screening as Part of Your Hiring and Retention Procedures

You invest time and money in pre-employment background checks to ensure you know who you’re hiring. But what if something were to happen after the person was hired, how would you know? While many employers rely on self-reporting policies, you may only find out there’s a problem when it’s too late.

Take into consideration that while it is obviously very valuable to know what is in a person’s record before you hire them, it is just as important to find out what may be going on behind the scenes after you’ve put your company’s reputation on the line – and after you have given them access to valuable resources and proprietary information. And this applies across all aspects of the background screening spectrum – it would likely be highly relevant to you if the person gets sued by a prior employer for breaching their non-disclosure agreement by joining your team, or is convicted of a DUI after you’ve given them a company car.

These are just a few examples of what could turn up after you’ve filled a valuable seat at your conference table.

There are a myriad of high-profile examples where a high-level employee was brought on by a prominent organization, only to bring an onslaught of negative media attention because of their fraudulent or illegal activities. But let’s look in particular at the recent case of the former Chief Digital Officer of the Epix cable television network.

As reported by CNBC, this individual defrauded the company of $8 million (ouch!) by contracting with vendor companies he owned to perform digital media services for Epix. According to court records, “those services were largely never performed and while the contracts listed several of [this person’s] former professional associates and business partners as vendor personnel, they had never heard of the vendors.” The individual was said to have hid the scheme by using false and stolen identities to conceal his involvement.

Now, a deep-dive background check, which should be the norm for employees of this level, would have revealed a list of the person’s affiliated businesses, along with other Officers/Directors, where available. This would likely have raised some eyebrows if these entities turned out to be the same as the “vendors,” and at a minimum would have been cause for internal investigation. Perhaps this could have kept their fraud from reaching into the multi-millions!

Take also the recent (fairly extreme) example of a small-town comptroller. In a case that has been heavily reported on, the individual started working for a small Midwestern city in the 1970s as a high school student, and later became city comptroller, a position they held for almost 30 years. Had any re-screening been conducted on this individual during their tenure, it likely would have uncovered some of the many red flags planted over the course of the 22-year scam, encompassing nearly $54 million in embezzled funds from a city with an operating budget of only one-fifth of that amount per year. While the full extent of the fraud could only have been discovered with assistance from the FBI, at least on a local scale, a background check could have revealed property holdings and assets in the multi-millions – which would have been alarming for a city worker making just over $80,000 per year.

In thinking through your own screening procedures, consider an annual re-screen – better yet, arrange for a “set it and forget it” schedule with your background screening company. In a set-up like this, your key individuals would be re-screened automatically in the Third Quarter of each year, for instance, so you have relevant and potentially new “red flag” information in-hand as the year ends. And keep in mind that these types of re-screening efforts can often be done at a steep discount, so it becomes even more of a no-brainer!

To learn more about our re-screening services, contact us.

This publication is for informational purposes only and nothing contained in it should be construed as legal advice. We expressly disclaim any warranty or responsibility for damages arising out this information. We encourage you to consult with legal counsel regarding your specific needs. We do not undertake any duty to update previously posted materials.