Callcredit is providing Know Your Candidate with a managed service that processes employee records in bulk and produces easy-to-understand credit reports. The data includes separate files for employees who have court judgements and insolvencies, allowing Know Your Candidate to quickly identify relevant results and report back to their clients.

Employee Credit Checks are becoming increasingly important as businesses, particularly in the financial services sector, look at reducing their fraud risk. Employment screening is now often viewed as an ongoing requirement, rather than a one-off pre-employment check, with many firms carrying out annual credit checks across their workforce.

Callcredit offers a range of credit-checking and identity verification tools across a variety of sectors, providing businesses with greater confidence and protection against fraud risk.

Barry Hetherington, Managing Director of Know Your Candidate, said: “Switching to Callcredit from our incumbent credit reference agency provided us with a significantly better service. The biggest difference was that the format of the output data was much simpler and easier to understand, dramatically reducing our production and reporting time – which in turn, helped us to exceed our customers’ expectations.

“In addition, we found Callcredit provided more readily accessible support and more competitive pricing too.”

James Blake, Head of Sales at Callcredit, said: “Our expertise in handling and providing credit data means we were perfectly placed to help Know Your Candidate with its employment vetting process. We were delighted to be able to work with the company to create a managed solution that met their requirements for a streamlined and efficient service.”

Good Employment Vetting practices highlighted included:

• Staff are vetted using a risk based approach taking into account data security and other fraud risk
• Enhanced Vetting – including checks of credit records, criminal records and financial sanctions checks are made on employees in roles with access to large amounts of customer data
• Vetting should be proportionate and risk based i.e. not one size fits all
• Vetting should be repeated and on-going where appropriate
• Firms should have a good understanding of vetting conducted by employment agencies for temporary and contract staff
• The level of vetting conducted by third party suppliers is monitored and verified

Poor employment vetting practices observed included:

• Allowing new recruits to access customer data before vetting had been completed
• Temporary staff receiving less rigorous vetting than permanently employed colleagues carrying out similar roles
• Employee vetting is only a one-off exercise i.e. no on-going element
• Enhanced vetting checks only being applied to staff in Approved Person positions
• Relying entirely on an individual’s reputation as the basis for employment i.e. no vetting checks made

Know Your Candidate’s employment vetting service can help financial services firms, their suppliers and recruitment partners to implement the suggestions made by the FSA.

• Full range of background checks available in any combination to facilitate a risk based approach
• Fast turnaround times to ensure all staff are vetted before starting their role
• Bulk options available to facilitate annual and on-going checking
• Flexible pay-as-you-go service with no minimum volume commitments to make it cost effective for individual suppliers and recruitment firms to check a small number of staff to the levels desired by the regulated firm

Financial Services firms and their suppliers can learn more about our employment screening service including what our customers say at www.knowyourcandidate.co.uk/financial-services.cfm

Click here to view a copy of CPA 11/12 – Financial Crime a Guide for Firms

In England and Wales there were 270,919 judgements registered between January and June 2011, compared to 276,888 for the same period in 2010, with the average value of judgements also falling slightly from £3765 to £3244.

The picture in Scotland followed a similar pattern, with the number of Court Decrees, (the Scottish equivalent to County Court Judgements in England and Wales) decreasing from 14,213 in H1 2010 to 13,223 in H1 2011. However, the average value rose from £3457 in H1 2010 to £3766 in H1 2011.

Northern Ireland also saw a decrease from 5654 judgements in H1 2010 to 4713 in H1 2011.

One reason for the decrease in judgement numbers could be that lenders, under pressure from the government, are increasing their forbearance efforts working with their customers in difficulty much more than previously to find a solution other than requesting a judgement. However, excessive use of forbearance strategies could actually just be delaying court action which would lead to rising numbers of judgements going forward.

An employee’s financial situation can contribute towards the temptation to commit fraud in the work place; therefore it makes sense for employers to include financial checks as standard within their employment screening process.  Know Your Candidate’s range of Employee Credit Checks enables employers to see if applicants or employees have public financial data such as County Court Judgements on their credit file. Linked addresses are searched automatically, even if undisclosed by the applicant, to ensure that all judgements registered against an individual are found.

1. Only the Edited Electoral Register can be used for the purpose of Employment Screening. Individuals have the right to opt-out of the edited register and many do so. Research by Leeds based credit reference agency Callcredit in January 2011 found that the overall average opt-out rate across the UK is 45%. Many local authority areas see significantly higher opt-out rates – South Gloucestershire (81.95%), Bromley (77.51%) and Epping Forest (76.49%)
2. No ID checks are made when compiling the Electoral Register. The primary purpose of the register is to compile an accurate register of voters and as such the checks and balances in place when the data is collected are to prevent electoral rather than identity fraud. No one from the local authority visits each property asking to see copies of passports for everyone in the household

Know Your Candidate provides its customers with electronic identity and address verification. The electronic approach has been around for over 10 years and is used by many industry sectors including financial services and the public sector to verify an individual’s identity. The electronic approach compares the data provided by the applicant against a whole range of data sources, public and private, held by credit references agencies to find evidence that the applicant’s identity exists and they live at the address they claim. This approach considers the number of data items (breadth), the due diligence in place when the database record was created (quality) and the length of time the data items cover (depth). Clearly, the greater number of data items with high degree of due diligence when they were created (e.g. credit accounts) then the greater amount of confidence the employer can have that their applicant is who they claim to be. Checks are also made against alias names and mortality databases. To find out more about Know Your Candidate’s Identity and Address Check click here.

• A 3% decrease compared to 2009, but staff fraud up 40% since 2008
• Cases of obtaining / disclosure of personal data up by 63% on 2009
• 70% increase in unsuccessful employment application frauds on 2009

CIFAS also reported:

• 62% of staff fraudsters are male, 38% female
• The 21-30 age group committed most staff frauds, accounting for 58% of the total
• Disclosure of personal data accounted for 29% of all frauds committed by those under 21, the highest proportion of any age group, whereas very few people over 40 committed this type of fraud.

Barry Hetherington, MD of employment screening firm Know Your Candidate commented “clearly the figures released by CIFAS should be of concern to all employers, especially those holding personal data on consumers.  The reported increases could be due to one or a combination of factors: are they a consequence of the tough economic climate and rising cost of living? Are fraudsters stepping up their efforts to target employees of firms holding personal data? Are internal controls not strong enough? Are the rises down to more organisations simply reporting fraud to the database?”

“Employment screening is one of several tools, which used in combination, enable employers to help prevent employee fraud. Organisations which also implement robust internal controls, monitoring, on-going screening and effective procedures for reporting fraud will be in the best position to prevent employee fraud. The rise in unsuccessful employment application frauds is likely to be down to robust screening from the members of CIFAS staff fraud database rather than a large increase in fraudulent applicants. Employers with only minimal employment screening procedures in place beware – one of those 85 unsuccessful applicants behind employment application frauds may be heading your way!”

To download a full copy of the 2010 CIFAS Staff Fraudscape report click here. To learn more about the employment screening service offered by Know Your Candidate click here.

The 30,162 insolvencies were made up of 12,539 bankruptcies (down 31.3% on the corresponding quarter of 2010), 10,385 Individual Voluntary Arrangements (IVA’s) down 8% and 6788 Debt Relief Orders (DRO’s) which represents a 20.3% increase on Q1 2010. Figures for Scotland showed an 18% decrease to 4262 insolvencies in the quarter, while numbers rose by 25% in Northern Ireland.

While the figures may look encouraging, they are still high historically, being double the rate seen in 2005. In addition individuals still face considerable financial challenges in 2011 such as rising fuel and food costs and increased National Insurance contributions from April meaning that the trend is unlikely to continue downward. These figures show that employers still need to remain vigilant and continue to carry out employee credit checks on all employees. Only by doing this can employers devise effective strategies to help any employees in financial difficulty and demonstrate to auditors and their customers they are taking a risk based approach to protecting their business.

The white label service enables recruitment firms to market and provide an employment screening capability to their clients whilst leveraging the know-how and experience of a specialist provider. Candidate screening reports are branded with the logo of the recruitment company and resources such as template application forms and consent declarations are also provided.

In addition, the service is totally free to set-up with background checks provided on a pay-as-you-go basis meaning that recruiters can fulfil their clients’ screening requirements without any upfront investment or risk associated with setting up an in-house service.

Barry Hetherington, Managing Director of Know Your Candidate explains further, “Increasing numbers of employers across all industry sectors are requesting background checks such as Credit and Criminal Record Checks to help increase their chances of hiring the right employee.”

“Small and medium sized recruitment firms therefore need to be able to offer a screening service to win business but will find that the volume, type and frequency of checks required vary greatly on a monthly basis. This makes setting up an in-house screening operation a risky proposition, potentially wasting time and money that could be better spent on other initiatives. Our white label service instantly provides recruitment firms with access to a wide range of background checks, expertise and documentation that would take a considerable amount of time and money to build up.”

B2B Business Solutions www.b2buk.eu , a specialist recruitment company based in West Yorkshire, recently benefited from Know Your Candidate’s white label service on a key project for a major client.

Andy Bahado, Director of B2B was very impressed with the service “One of our major clients approached us asking if we could provide Credit, Financial Sanctions and Criminal Record Checks as part of our service. Our initial project analysis told us that acquiring the knowledge to manage the process successfully was unrealistic given the tight timescales involved and purchasing the licences required for the Credit and Sanctions checks uneconomical. Know Your Candidate’s service enabled us to fulfil our client’s requirements, react quickly and be certain the checks would be carried out efficiently. I would readily recommend the Know Your Candidate white label service to any recruitment firm looking for an employment screening service.”

The first guide – A Practical Guide to Employment Screening provides employers and recruitment companies with practical and impartial advice regarding how to design, implement and manage an effective employment screening process. The second guide, Background Checks – a Guide for UK Employers explains the many different types of background checks that can be incorporated into the screening process and also provides valuable hints and tips on how to speed up and get more information from the traditional referencing process.

Author, Barry Hetherington, Managing Director of Know Your Candidate Ltd explains the thinking behind the guides. “Employers looking to implement employment screening programmes are often confused about which checks to make on potential new recruits and how to manage the actual process of checking. The information currently available on the Internet is piecemeal and much of it is meaningless unless you understand why you are making a particular check and how the information returned is going to be used in your decision making process. The other popular approach of going to employment screening vendors for advice can also be a mistake as employers could end up with a process and package of background checks that is aligned to the vendor’s business model rather than their requirements.”

Implementing additional background checks without having adequately planned a suitable process will result in a process which adds extra administration and costs, reduces rather than enhances the candidate experience and ultimately fails to deliver the key outcome – to protect organisations from unsuitable employees. By providing free, practical and unbiased advice and de-mystifying the process the guides enable employers to accurately evaluate their requirements and design and implement employment screening programmes that avoid these pitfalls.” 

The guides can be downloaded free of charge at www.knowyourcandidate.co.uk/brochure-download.cfm

The Court Judgement and Bankruptcy Check, commonly referred to as a Credit Check, is a requirement of BS7858:2006 – the British Standard for Security Screening of Individuals Employed in a Security Environment. It is the component of the BS7858 check which security firms require external help to complete. However, sourcing the Credit Check component often proves problematic for security firms, especially smaller ones, as their recruitment activity is unpredictable and there is no guarantee they will need to hire any new employees throughout the year. This means that setting up arrangements directly with Credit Reference Agencies is out of the question due to the high set-up and annual fees required, while traditional employment screening companies often only include the Credit Check within their full BS7858 check package which pushes up the price significantly.    

All this is now a thing of the past due to Know Your Candidate’s pay-as-you-go online employment screening service. Security firms can now purchase credit checks as and when they require them with no registration or annual fees to pay. Registration is free and takes less than 5 minutes, with no contracts or supplier paperwork to complete.

Sue Bradley, HR Manager of rural and equine security specialist, Atticus Risk, commented: “Know Your Candidate provides a timely and efficient financial vetting service that allows us to effectively assess our candidate’s suitability for employment within the security industry in line with the demands of BS7858. The website is user friendly and reports returned are clear and well laid out. The pricing structure and range of checks available ensure that ongoing use of the service is financially as well as operationally sustainable, particularly for an SME wishing to only outsource part of its recruitment process, or for a firm with a low turnover of staff”.

Barry Hetherington, Director of Know Your Candidate welcomed the comments saying “small and medium sized companies were at the forefront of our thinking in setting up Know Your Candidate. From the outset our aim was to provide a reliable, easy to use employment screening service for SMEs, providing information rich, clear reports at competitive prices. We believe that small and medium sized companies should have choice in how they approach employment screening – if a company only requires a check once in a while they should not be forced to pay extra just to fit in with the provider’s business model.”

The service eliminates the costs and complexities of traditional in-house or out-source alternatives. In-house options mean investing time and money in set-up procedures and relationships with data brokers e.g. Credit Reference Agencies for Credit Checks and Identity Checks, Criminal Records Bureau for CRB Checks and the DVLA for Driving Licence Checks. Fees can run into thousands making it uneconomical for organisations recruiting less than 50 staff a year.

The outsourcing option also proves difficult and expensive if there are only a handful of employees to check at any given time and the employer does not know when they’re likely to require the services of the screening company again. This can lead to a second class service compared to large scale employers.

Barry Hetherington, Director of Know Your Candidate, says that the status quo discriminates against SMEs commenting, “On investigating the market we found employment screening providers consciously and unconsciously placing significant hurdles and barriers in the way of SMEs. These include issues such as: inflated pricing, lengthy supplier paperwork and forcing customers to buy set combinations of background checks. In addition, screening providers are very reluctant to give SMEs access to their online systems meaning that the employees’ details required to conduct the checks must be submitted by fax, giving the customer no visibility of progress until a final report is produced. This is a wholly unsatisfactory state of affairs.”

“We couldn’t see any reason why SMEs should pay more or receive a lower level of service than larger organisations. With the highest unemployment for a decade and their large corporate customers demanding ever increasing levels of security, the requirement for SMEs to conduct more robust background checks on their new employees has never been greater. Know Your Candidate delivers a high quality, cost effective employment screening service, on a pay-as-you-go basis.”

Commenting on the new service, leading enterprise email-management company Communicator Corp (www.communicatorcorp.com), with around 50 employees is a typical Know Your Candidate customer. As John Readman, Sales and Marketing Director at Communicator Corp explains, “Hiring the best people has always been a priority as success comes from having a good product and service delivered by exceptional people. For us, we know that this underpins our ability to provide our customers with the best service and it drives product innovation. Therefore, we need to ensure we have the best candidates. The Know Your Candidate service helps to ensure we achieve this.”

“Indeed it is now even more important as our customers and prospects are increasingly asking how we background check our staff, including Co-Op Financial Services who have been impressed with our proactive approach. Having the ability to source background checks quickly and inexpensively helps us to continue or policy of hiring only the best quality people and in turn this means that we can demonstrate our own stringent vetting requirements to our customers.”