Is that new hire a crook in disguise?
September 17, 2008 by Carol KatarskyPosted in: Best practices, Communication, Fraud prevention, Hiring & training staff, Special report
After all your hard work to keep controls airtight, one wrong hiring move could put it all at risk.
We all hate to think it can happen in our own companies, but the facts are that most fraud attempts start with someone who works within the target company.
Worse, internal fraud is most commonly attempted by someone who works in Accounting or in upper management, so it makes sense that you have to be doubly careful about bringing new people on board.
It’s worth touching base with HR and other hiring managers to make sure the vetting process for new hires gives adequate attention to potential red flags that could indicate someone has a less-than-stellar past. To weed out potential crooks from your hiring pool:
- Do a real reference check — It sounds basic, but many companies rarely call references. And those that do call references often just spot check by calling one out of three names a candidate offers.
- Ask if they’re “rehire-able” — Many former managers won’t give you much information beyond dates of employment and the person’s title when he or she left. They’re afraid too much information could leave them open to lawsuits if the person doesn’t get the job. But one question is open-ended enough to protect them and revealing enough to help you. Ask if the person is eligible to be rehired by their company. If not, you know there’s more to the story than a typical job hunt.
- Get a complete background check — criminal convictions, bad credit, evidence of current drug use and a host of other issues can be a red flag that either the applicant has a bad history — or that he or she could be vulnerable to bribing by outsiders looking for financial info.
Note: How deeply you can dig into an applicants’ background — and how much warning you have to give — is a tricky legal area. So make sure you get HR to sign off on these strategies.
But if it protects your company from hiring someone whose real career goal is to rob your company blind, the extra effort will more than pay off.
Tags: A/P, Fraud prevention, Hiring staff, Payroll
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September 18th, 2008 at 12:03 pm
Asking a former employer if they would rehire the person would not work. Many companies have an unofficial policy in place that once an employee leaves – they cannot be rehired.
September 18th, 2008 at 2:36 pm
We found away around the problem James refers to by simply following their answer of “No”, with the question “Is it part of your corporate policy to not re-hire ex-employees?” Believe it or not, most who answer no to the first question, answer yes to the second.
September 18th, 2008 at 4:00 pm
HR best practices require that all references, professional and personal need to be checked, without exception. If it’s done systematically, the procedure is not time consuming: call the last ones listed first, speak to the immediate supervisor, never human resources. Identify yourself, ask for their help, then shut up. Let them respond to offer to help you, and ninety percent will by using this method. Use a fill-in-the-blanks form to keep it on track, covering employment dates, (where did they work before you/after they left you?) duties, verify pay, reason for leaving, eligibility for rehire, comparison to others doing the same job, unsafe work habits or accidents, attendance/punctuality, ability to work with others, communications skills, strengths and weaknesses, (what could he/she have done better?) and conclude with, “is there anything else we should know considering him/her for employment?” Avoid anticipating the answers and let the supervisor tell you, listening carefully not only what is said but how they say it, and what they leave out. The form in front of you keeps you on track when you do follow up questions. They may not tell you if you don’t ask. Keep digging if you get an extreme one way or the other reference. A reference check is one of the most important tools in deciding whether to hire by speaking with someone who has actually worked with them. If you’ve honed your listening skills, you will learn more about the candidate than by any other means.