A $1.25 million fine was recently levied against the J.P. Morgan Chase company by the Financial Industry Regulatory Authority for lapses in employment background check processes. This steep fine against such a high profile company is a reminder of the costs of employment screening failures.

When it comes to financial services, few names are as recognizable as J.P. Morgan. However, this popularity does not exempt them from using proper employment screening processes. In fact, as shown by the steep fine, the larger and more successful the business, the higher the stakes for employment screening failures.

Even Industry Giants Can Have Employment Screening Failures

The J.P. Morgan Securities company was found to be conducting incomplete background checks from January 2009 through May 2017 on 95 percent of non-registered associate employees. This violated regulatory imperatives and prevented accurate determination of eligibility for employment.

To J.P. Morgan’s credit, they self-reported the employment screening failures to the Financial Industry Regulatory Authority (FINRA). This resulted in a more lenient settlement and a lower fine than otherwise would have been assessed.

Lapses in a company employment screening policy are often the result of:

• Deficient procedures
• Out of date policies
• Communication failures within the company
• Lack of transparency
• Compliance issues
• Screening gaps

In the case of the recent J.P. Morgan lapse, the securities company failed to conduct adequate fingerprint screening for eight years on thousands of non-registered employees and associated persons. This caused potentially ineligible or even risky personnel to be hired by the firm.

While some personnel were fingerprinted, others were not screened for felonies or disciplinary actions taken by financial regulators. Such screening is required in their industry under the Exchange Act and Financial Industry Regulatory Authority laws.

Employment Screening Failures Can Be Costly

J.P. Morgan screened only for certain criminal convictions and was not comprehensive and compliant in its employment screening processes. The lapses resulted in the hiring of high-risk individuals who had a criminal report in the omitted areas. The price of these employment screening failures was a $1.25 million fine, which could have been even higher had the firm not self-reported the errors.

Companies large and small can learn from the recent mistakes of financial giant J.P. Morgan. The best way to avoid making mistakes like these is to partner with a professional employment screening service.

Professional Employment Screening Equals Peace of Mind

Professional employment screening can help to avoid employment screening failures and ensure companies make informed and intelligent hiring decisions. Businesses can help themselves to avoid hiring dishonest or otherwise unqualified employees as well as negligent hiring lawsuits down the road. Company finances and intellectual property is far more secure when honest, qualified and thoroughly vetted individuals are hired.

To avoid making potentially costly employment screening failures, businesses should strongly consider outsourcing employment screening to an experienced professional. In addition to avoiding oversights, it allows HR departments to stay focused on job-centric screening such as interview protocols and candidate testing.

Disclaimer Statement: All information presented is for information purposes only and is not intended to provide professional or legal advice regarding actions to take in any situation.

A stunning 75 percent of hiring managers report that they have uncovered fraudulent resumes and caught job applicants lying on their resumes, according to a recent CNBC article. While it’s natural for applicants to want to show themselves in the best possible light, in a competitive market, job seekers may be tempted to take this beyond slight embellishment to outright fabrication. Businesses and hiring managers must be highly vigilant about such possible transgressions on applications and resumes.

The following are five of the most telling signs of fraudulent resumes:

1. Employment and Job Skill Set Anomalies

Information related to work history, skills and training has been cited as the area most likely to be fabricated by dishonest job seekers. Hiring managers should carefully scrutinize this area for gaps and listings that seem suspect. If the applicant can’t back up their claim, it could be a lie. The only way to know for sure is by following up with the employer and conducting and employment verification or educational institution and conducting an education verification. Calling references and using employment screening can also help to verify that the applicant has a track record of honesty.

2. Dates That Don’t Make Sense

Lying about employment and dates related to schooling is common in fraudulent resumes. Applicants who use this technique are usually striving to hide gaps in their work history. They may also be fabricating educational history such as classes taken, schools attended and degrees earned. Following up with each employer and educational institution listed is the only way to know for certain if the applicant is being honest in these areas. Dates that overlap or contradict one another are a definite red flag on a resume.

3. Typos and Grammatical Errors

Making an excellent first impression is key on a resume. Even persons who were not English majors are aware of the importance of triple-proofreading their resume or having it edited by a professional writer. If a resume is riddled with errors, this is a sign that at the very least the resume writer created it carelessly. However, it might also mean that portions of it were fabricated or embellished.

4. Glaring Omissions / Ignoring Instructions

The failure to follow employer directions and requirements on a resume is another red flag. While some applicants have a general resume that they use when applying for every job, they should be conscientious enough to tailor it to each employer’s specifications. Large gaps deliberately left in the resume in any area are also definite red flags. Failing to include a cover letter is another possible sign that the applicant is not qualified for the job and trying to hide it by omission.

5. Strange Wording or Lack of Specificity

The employer or HR manager should use their intuition to look for fraud when reading resumes. There are some areas of fraudulent resumes that can be hard to pinpoint or categorize; however, if a job description seems suspiciously devoid of detail, strangely worded or otherwise unconvincing, it’s possible that this section of the resume was fabricated.

Effective hiring is crucial to workplace morale and business success. Hiring managers should perform an employment verification and screen all resumes for these five signs of fraudulent resumes. Using professional employment screening can also assist in identifying candidates with a criminal history or other issues that could impact their viability.

 Disclaimer Statement: All information presented is for information purposes only and is not intended to provide professional or legal advice regarding actions to take in any situation.

Some employers make the mistake of exempting applicants for higher-level positions and not screening executives. They may feel these individuals are high-profile and experienced enough to deserve inherent trust; however, these workers have the potential to do the highest amount of damage in areas like white collar crime and brand reputation.

Not properly vetting and screening executives and other high level staffers such as members of upper management team could hurt the company in the following four ways:

1. Financial Loss

The more power a worker has, the higher their potential for impact on the company’s finances. While a rank and file employee could steal from the company, executives and upper management often have far greater access to the company’s resources and sensitive data, making the potential for theft and financial loss much greater.

2. Revealing Trade Secrets

Screening executives and managers is critical because they also tend to have the most access to sensitive company information, and by extension the highest potential to commit fraud on a large scale. Higher-level staff members can also fall victim to bribery or have other motivations for sharing trade secrets with competitors. While having them sign a non-disclosure agreement and other privacy measures can help, a criminal background check and other employment screening checks can yield insights into their track record and character.

3. Negative Press for the Company

Executives and upper management tend to be higher-profile workers. As such, if they become involved in dishonest dealings, corporate scandals or a personal scandal, this will generate negative press for the company. This in turn can result in untold damage to the brand. Screening executives by checking their background and past history and including a professional reference verification can help employers to determine if a potential hire will be a risk in this regard.

4. Lawsuits

Not screening an executive or other high-level employee who goes on to damage the company can also result in negligent hiring claims and other litigation. Put simply, the stakes are higher with these individuals, and while they can do the most good for an organization, they also have the potential to do the most damage.

While some businesses seem to give a pass to screening executives and upper management when it comes to employment background checks, pre-employment background checks are probably most crucial for these individuals. Companies can protect themselves in the four areas discussed here by ensuring that applicants at all levels are professionally screened, including screening executives.

Disclaimer Statement: All information presented is for information purposes only and is not intended to provide professional or legal advice regarding actions to take in any situation.

Newspapers and online job boards are full of the typical “Help Wanted” ads that thousands of people view each day. Many companies still rely on the traditional employee recruitment methods of finding potential employees. However, when looking for those unique individuals to move the business forward, companies need to think more non-traditionally and have a creative employee recruitment strategy.

Use these innovative employee recruitment methods for finding quality candidates and top talent:

Make Use of Social Media

The company’s future work force is likely to come from people who use their mobile devices to look for new opportunities. Posting job listings on social media sites is the minimum that should be done. Increase the use of social media with these creative employee recruitment ideas:

• Have the existing staff make short (15-30 second) videos about why they love working for the company and post them on the company’s YouTube channel.
• Create podcasts that talk about the openings currently available and why they are critical to the company’s success.
• Use a Pinterest site to showcase the company’s innovative products and services along with the people that the new employees will be working with.

Host a Group Function

Book a local venue or host a Google Hangout for groups of potential candidates to discuss their future with the company. Invite current staff to talk about work environments and what’s expected of them in their roles. The recruiter will gain insight into the candidates from the types of questions they ask during these group functions.

Create Eye-Catching Billboards

A new take on traditional signs can be effective in capturing the attention of potential candidates. Rent a billboard along a busy highway of business commuters with the message “You Could Be At Your Dream Job Right Now.” Make the billboard fun and creative so it has a lasting impact. Make sure to include an easy-to-remember contact number (800-WOWJOBS) or website (www.HIREMENOW.com) for people to use when they get to their desk or back home.

Make the Hiring Event a Contest

Schedule a hiring event with prizes offered for such contest items as the best slogan for a new service or the most innovative way to use one of the company’s products. Put potential candidates in competition with one another by sponsoring a 30-minute design-a-dress contest, or a competition for the most unique taco recipe. Make the employee recruitment contests fun, interactive and relevant so that more can be learned about potential job candidates.

Lastly, the company’s current employees can be an excellent resource for employee recruitment and getting the word out about open positions. Make it easy for them to speak well of their employer by using a professional screening service that makes the process efficient and painless. Workers will then communicate to future candidates how easy it was to apply and become a part of a growing, successful company.

Disclaimer Statement: All information presented is for information purposes only and is not intended to provide professional or legal advice regarding actions to take in any situation.

The “gig” economy has resulted in more contract workers and self-employed persons in the marketplace than ever before. Technological advances have made it possible for an increasing number of workers to work freelance instead of being hired on as formal employees. In the past, less stringent hiring and screening measures were taken with these employees, as they were viewed as temporary.

However, recent data has revealed that employers are now screening the vast majority of their freelance and contract workers. One study showed that as many as 86 percent of companies are now screening this class of workers – up a huge 45 percent from the year 2012.

The following are four of the top reasons companies are now screening their contract workers:

1. Record Numbers of Self-Employed Workers

With so many more of this type of employee in the workplace, the odds of hiring the wrong person are much higher. Employment screening reduces the risk of fraud, lawsuits and loss with all workers, increasing the quality of the entire staff.

2. The Expanded Role of Contract Workers

While in the past freelance and contract workers usually only had limited access to the company’s data, equipment, facilities, clients and other workers, today their roles are often much more involved. Because of this expanded capacity, many businesses are choosing to conduct contractor background screening just like any other worker.

3. Increased Instances of Fraud on Resumes and Applications

Research has indicated that applicants are much more likely to lie on employment applications than they were even five years ago. A majority of businesses have reported finding at least one misrepresentation, distortion or outright lie on a job application or resume, and 56 percent of applicants admit to lying. This is likely due to a more competitive marketplace, and businesses can no longer afford the risk.

4. A Desire For the Best Candidates

There is clearly a trend toward longer-term contract workers and freelance assignments due to the growth of the  gig economy. This model is expanding to established businesses as well. As always, companies want to connect with the best, brightest and most trustworthy candidates in the pool of available workers. Employment screening is an efficient and reliable way to help accomplish this whether the employee is permanent or temporary.

Freelance, temporary and contract workers are more prevalent in the workforce than ever before. It’s no wonder businesses are screening them in increasing numbers.

Disclaimer Statement: All information presented is for information purposes only and is not intended to provide professional or legal advice regarding actions to take in any situation.