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Employee background Screening, educational verification, criminal history record research, civil litigation

Employee background Screening, educational verification, criminal history record research, civil litigation

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  • 2. Human Assets Can Make Your Business Fly – Or Sink  The “human factor” is the common element in most risk and crisis scenarios  9 out of 10 risks or security problems are caused by people inside your organisation
  • 3. Business Risks on HR Side  Fraud  Corruption  Organised crime  Distribution scams  Backlash vs. workouts   Legal disputes  Sabotage Confidentiality breaches  Industrial espionage  Kidnapping  Accidents  Intellectual property theft  Extortion  Mismanagement  Unsecure data & communications  Service deterioration  Workplace violence  Contractual risk  Workplace theft  Harassment & discrimination claims (including violence against executives and facilities)
  • 4. Asian Labor Environment  Asia is a growth area representing a major source of new professionals…  …Yet it is also a major center of labour ethics violations  Unethical sources include: child labour, sweatshop labour, forced labour, prison labour  Cultural differences – “us vs. them” – make multinational corporations vulnerable
  • 5. HR-related Crime Scenarios  Fraud, industrial espionage, intellectual property theft and piracy, corruption, sabotage: staff are often involved  Data & communications are at risk from employees, not just from external enemies  Organised crime may recruit your staff, or plant stooges
  • 6. HR-related Crime Scenarios  Workouts & downsizings can spark backlashes, violence, asset stripping, hostage taking  Product tampering extortionists are often insiders  Kidnappers rely on insider information
  • 7. Common Traits of Companies That Get Into Trouble        Frequently rotating managers Poor public and corporate records Migration of cliques – “tribal loyalty” Corporate culture not instilled Neglect of due diligence practices Internal controls not firmly enforced No corporate HQ connection with key staff
  • 8. Ongoing HR Risk Mitigation Employee Integrity Program (EIP)
  • 9. Employee Integrity Program (EIP) – Why Have One?  Your organisation needs:  Honest employees  Effective internal controls  Strong & visible deterrents
  • 10. Employee Integrity Program (EIP) — Why Have One?  An effective EIP will help you:     Reduce risks to your reputation Protect your resources Improve your bottom line Build your company’s value
  • 11. Employee Integrity Program (EIP) — Why Have One?  An effective EIP will also help minimise losses relating to: Internal fraud & theft   Workers’ compensation claims   Non-performance of duties  Non-compliance Negligent hiring  Workplace violence
  • 12. What Goes Into An Employee Integrity Program (EIP)  Background checks on senior or sensitive employees  Professional pre-employment screening  Monitoring and surveillance  Spot checks on ethics compliance  Substance abuse testing (USA)
  • 13. What Goes Into An Employee Integrity Program (EIP)  Risk analysis of your organisation  Whistle-blowing & complaint mechanisms  Structured exit interviews  Strict standard operational procedures to maintain control over your organisation
  • 14. Pre-Employment Risk Mitigation
  • 15. What is the most common type of fraud in the world? Answer: Résumé fraud
  • 16. Pre-Employment Screening    LEVEL 1: Light Screening LEVEL 2: Medium Screening LEVEL 3: Full Screening All companies should conduct thorough background checks before hiring. Three different levels of preemployment screening are available to fit your needs.
  • 17. Pre-Employment Screening  When considering pre-employment screening, consider the following:  Find out not just where and when, but why the candidate left the previous job.  Explanations of employers and copies of resignation letters should not be taken at face value
  • 18. Pre-Employment Screening — Three Levels of Scrutiny LEVEL 1: LIGHT SCREENING Level 1 checks include:  Verification of last job  Criminality check  Verification of highest degree obtained  Verification of ID number (many forgeries)  Verification of address
  • 19. Employment Screening — Three Levels of Scrutiny LEVEL 2: MEDIUM SCREENING Level 2 checks include all of the checks in Level 1, plus:  Verification of past 5 years employment  Research into past financial behaviour
  • 20. Pre-Employment Screening — Three Levels of Scrutiny LEVEL 3: FULL SCREENING Level 3 checks include all checks in Levels 1 & 2, plus:  Verification of 10 years of employment  Discreet in-depth reputational interviews  Litigation checks
  • 21. Pre-Employment Screening — Three Levels of Scrutiny LEVEL 3: FULL SCREENING     Firms owned, licences held, discipline actions Media research Property asset research Research into liens, bankruptcy records
  • 22. Mitigating HR Risks in Downsizing Scenarios
  • 23. “Getting Even” Downsizing, restructuring, liquidation, exit time, firings, non-payment of bonuses, and similar actions often lead to:  The “Getting Even” syndrome  “Tribal loyalties” that outweigh corporate loyalty  Hidden liabilities, pensions, redundancy pay, other issues
  • 24. “Getting Even” Additional threats include:  Asset stripping, sabotage, theft, embezzlement  Poison letters, dirty tricks  Theft of trade secrets, intellectual property theft  Attacks on computer systems  Pre-departure “gifts” – including computer viruses  Physical violence, hostage taking
  • 25. Mitigating HR Risks in Downsizing Scenarios  Have effective business controls in place  Control systems must be able to deter, detect & respond to internal threats  Have early warning systems to spot risks  Carry out risk & threat assessments before downsizings, firings or “bad news announcements”
  • 26. Mitigating HR Risks in Downsizing Scenarios Other tactics to mitigate risks:  Enhance management-staff communications  Enhance crisis management planning  Have contingency plans to deal with hostile employees or ex-employees
  • 27. Mitigating HR Risks in Downsizing Scenarios  Enhance security to protect people & premises  Prevent unauthorised electronic access  Protect & backup all operating, financial, and data processing systems & crucial assets
  • 28. Mitigating HR Risks in Downsizing Scenarios  Monitor departing staff on the way out  Who are the staff most likely to stir trouble?  Check employee computers for hostile plans  Check ex-employees’ computers for erased files
  • 29. And Upsizing Scenarios — They Also Pose HR Risks  Growth requires reviews of security & HR risks  The “feel good” environment of expansion & high turnover growth can blind a company toward its risks  Businesses outgrow existing controls — that’s when security gaps appear
  • 30. And Upsizing Scenarios — They Also Pose HR Risks  Traditional organisational, financial & security controls may be inadequate protection against disaster  Business processes can break down, and organisational mismanagement ensues
  • 31. Case Studies Background checks reveal alarming discrepancies. The following are based on true cases.
  • 32. Case Studies CASE 1: Forgeries and Fakes  The applicant claimed to hold a university degree  The university named by the candidate reported that the applicant’s degree was ‘fake and forged’  A reference letter, apparently signed by the university’s Deputy Controller of Examination, was also ‘fake and forged’  A second degree (BBA) claimed by the applicant was never conferred, and the claim was false
  • 33. Case Studies CASE 2: False Employment Record  A post-employment verification is conducted on a current employee  One of the employee’s previous employment records is revealed as fake — she had never been employed by the company, as claimed  For the rest of her employment details, there were conflicts in claimed job titles, duties and salaries
  • 34. Case Studies CASE 3: Fraud Alleged by Former Employer  When contacted, an applicant’s previous employers reported that the applicant had been terminated due to cash embezzlement, harassment and workplace violence  A second employment verification revealed this termination, and the fact that the employee caused a financial loss to his employer
  • 35. Case Studies CASE 4: Fake Reference Letter  Applicant provided a reference letter from her previous employer  This employer was contacted and shown the reference letter  The organization revealed that the applicant had never been employed by them, and the letter she had provided was a fake