Uncovering Dark Secrets: Executive Background Checks Recruiter’s Corner Are you one of those people who does a bit of truth-stretching on your resumé? If so, you're in good company. Fibs about education level particularly are something of a time-honored tradition, and not uncommon on executive resumés. But times, they are a-changin'. Resumé padders are at greater risk than ever of getting caught. ADP Screening and Selection Services reported a 65% jump in background checks between 2001 and 2004. Executive background checks have become increasingly common, particularly following corporate accounting scandals and fear of terrorism. Background check experts tell us that over half of executive resumés contain false or misleading information. The checks are a way to confirm if a candidate is really the person he or she claims to be. In the credit union industry we often have a level of assurance about an executive level candidate's character not found in many other industries. It's a pretty tight industry, so close-knit it is often referred to as 'incestuous,' so we can usually get the inside scoop on someone's background with a few phone calls, right? Well, not always. The wonderful success and the fraternal nature of the credit union industry has attracted people from other industries for a long time. We host many (many!) bank refugees, plus we have folks from the health care industry, accounting firms, you name it. CFOs, IT types, and HR people in particular can come to us from other industries. They don't always have that long industry track record we often see in the credit union upper management world. Toss our litigation-addicted culture into the mix, and you get a situation where your information sources either don't know the entire background of a candidate, or they are afraid of disclosing the full good, bad, and ugly on a candidate for fear of legal reprisal. So we're back to background checks. A basic background check usually involves checking education credit (place, date, subject), previous employment and - in financial institutions - credit history. But it is becoming more common for companies to delve deeper into the original basics, plus look for sex offenses, civil litigation, and more. A prospective employer can conduct a nationwide Criminal Federal Court search, or a Civil Federal Court search. Past defiance of laws, rules or regulations, unsafe or unsound practices, breaches of fiduciary duty, and violations of "final orders" can also be checked via multiple sources, including the NCUA, the FDIC, and the Fed's Board of Governors. When using the results of any background check to deny employment, however, beware! The Equal Employment Opportunity Commission (enforcer of anti-discriminatory employment laws) reminds us that any reason an employer uses to deny employment must be job related. Experts say that civil-related matters usually don't pass the test. I was recently speaking with Barry Nadell, president of Chatsworth, California-based InfoLink Screening Services who said, "I don't believe that civil searches are job related...if you do a civil search, you have to be ready to defend the job-related aspect of it." Philip Deming, principal of security and human-resources firm Philip S. Deming & Associates in King of Prussia, Pennsylvania, had a similar comment, "I see a lot of employers gathering information even though they can't explain why they need it." "Using any of the search services, like LexisNexis," said Deming, "you can get information on whether a person has ever had a foreclosure, been sued or arrested, or if he lives with someone he isn't married to _ data that isn't relevant to a job but still makes an impression on a potential employer." Speaking of getting arrested, remember that there is a big distinction between an arrest and a conviction. An arrest is not a conviction, and Equal Opportunity laws mandate that employers cannot use arrest information that did not result in a conviction as the sole basis for a hiring decision. Some states even have legislation prohibiting the use of "arrest only" information. These states include: California, Hawaii, Illinois, Massachusetts, Michigan, Nevada, New York, Pennsylvania, Rhode Island, Utah, Virginia, Washington, and Wisconsin. Background checks are here to stay. If you are an employer, and are not already using them as part of your hiring process, now is a good time to start. As far as which company to use, there are several reputable organizations out there doing great work. Check in with other credit unions to see which background check companies they like best. Conclusion for position applicants: if you've had legal woes in your past, be prepared to disclose them. Be honest about employment dates, and resist the temptation to inflate your education. One of the most routine things background checks turn up is confirmation that the candidate got "creative" with the education portion of the resumé. There are now more options than ever for getting your degree; just do it! Conclusion for people making hiring decisions: Unless you really know your candidate, background checks are a good idea. Employers can be so eager to fill a position (it's been open too long, the department is really feeling the pinch, etc.) that they will sometimes make a hiring decision in which high hopes for greater things hinders sound judgement. At a minimum, conduct a check of education, employment history, and criminal background. If you deny employment based on an unsavory element that turned up in the background check, make sure the offending detail is somehow job-related. Elaine Boyd is president and founder of CU Executives, Inc., a recruiting organization specializing in executive-level and IT talent for credit unions. Contact her online or by phone at 619/269-6464. |