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   Fourth Background Screening Industry Survey - January 2008

Some of the Key Findings:

Technology remains key in delivering service, however, industry providers are placing a lower importance on technology as a differentiator
Virtually all background screening firms provide a technology-enabled screening service. The industry has evolved over the past few years and a base level of technology is required even to be considered a viable service provider.

Integration of services is expected to increase in all areas
Although there has been a four year trend of increased requests by customers to integrate their offerings – especially with HRIS – integrated services still comprise only a small portion of the market.

Pricing remains a key factor driving customer purchasing decisions
Almost 80% of all respondents ranked price among the top three factors and, regardless of provider size, it was the factor most cited in the top three.

Large and medium-sized providers are facing margin pressure
Margin compression was cited in the top three challenges by over half of all respondents. In fact, almost 70% of large providers cited margin compression as a critical challenge

Although competition remains strong, providers project strong industry outlook
Large and medium-sized companies continue to grow their customer base by taking business from other third-party suppliers. The number of new implementers (companies implementing background checks for the first time) has decreased to 24% today. This likely reflects a more saturated market and the level of new implementers will decrease going forward.

Click Here To Read the Entire Report

Employers Beware – Resume Fraud A Major Problem

A recent article in the Boston Business Journal reported that according to hiring managers and human resource professionals, the falsification of a resume is a widespread problem. Misrepresentation on a resume or employment application can take two forms:

· The making of a false or misleading statement, or
· Omission of significant details about an applicant's background or employment history.

According to this article, stretching dates to cover up employment gaps is the most commonly-caught resume lie. An applicant may believe that he or she will not be viewed in a favorable light if the resume reflects periods of unemployment. Also, an open period of employment may suggest that the reason for leaving the prior employer may have been for reasons unflattering to the applicant. To deter misrepresentations, the employer's application or hiring materials should include a statement that any false or misleading representations during the application process or the failure to disclose an important fact will immediately disqualify the applicant from any further consideration for employment. Finally, you should resist the temptation, and more importantly convince management to resist the temptation to overlook misrepresentations during the application process "because we really need someone." Misrepresentations on a resume or in the application process may reveal a character flaw which could prove harmful to the company in the future if such a person is employed today. Recognize that in a tough job market, applicants may bend the truth, or lie - be prepared!

For More Information Go To: http://rjtlawfirm.typepad.com/

Background Badges: Records Checks Come With Proof You Passed

Ike Tippetts' Tempe, Ariz., plumbing business used to do its own criminal background checks on job applicants using Internet databases that are easy to access but give incomplete information. When the company was hiring for a controller last year, Tippetts said, he decided to do a more thorough check. A local trade association referred him to CrimShield, a Mesa, Ariz., screening firm. For $55 a person, CrimShield's licensed private investigators search county, state and federal court records and other documents to find out whether both current and potential workers have criminal pasts. But the company has added a marketing twist to a commonly offered service -- it issues identification badges to the employees it screens. The badges include a picture of the employee, CrimShield's logo and the logo of the company for which they work. The badges also contain an ID number, which an employer can use to track the employee's information on CrimShield's database. CrimShield's business customers can also use the system to send their customers an e-mail before an employee arrives at their door. The e-mail shows the worker's picture and states that he or she has undergone a background check.

For More Information Go To: http://www.courier-journal.com/apps/pbcs.dll/article?AID=/200804210430/BUSINESS/804210323

Would you hire this man?

Charles Cullen kept getting hired and fired until his murder arrest. Why job references say too little.

At many American companies, managers face gag orders that make prisoners of war look positively chatty. Forget "name, rank, and serial number." When someone asks for references on a potential hire, these bosses are supposed to reveal only job titles and dates of employment.

Never mind that the employee pilfered office supplies, harassed the receptionist, or threatened co-workers. In the lawsuit-phobic world of corporate America, caution keeps many lips zipped tight, everywhere from the factory floor to the human-resources office. But a chorus of legal experts and employment consultants is calling for a return to the days when job references flowed more freely and managers didn't need to break rules to criticize - or compliment - an employee. "I do see why employers are very cautious, but the policies put a lot of wackos out there in the workplace because people don't share information," says Peggy Garrity, a Santa Monica, Calif., attorney who represents employees. While reliable numbers are hard to come by, it appears that about 70 to 80 percent of American companies forbid employees from giving out extensive references, says J.H. Verkerke, professor of law at the University of Virginia.

http://www.csmonitor.com/2004/0301/p14s03-wmgn.htm

The Harvard Business School projects that bad hires cost employers three to five times the employees’ first-year salary

EMPLOYMENT Hiring Pace to Remain the Same, Says CareerBuilder-USA Today Forecast CareerBuilder.com, an online job site, and USA Today released the results of their latest survey, conducted by Harris Interactive, tracking projected hiring trends for the upcoming quarter. The survey, titled "Q2 2008 Job Forecast," was conducted from Feb. 11 to March 13 among 2,757 hiring managers and human resource professionals in private sector companies. "The job loss reported in the first quarter signified a gradual deceleration in recruitment in the U.S. as the nation's economy downshifted," said Matt Ferguson, CEO of CareerBuilder.com. "In the next three months, employers anticipate marginal change in their hiring pace. While some industries are experiencing a contraction in employment levels, areas such as information technology, health care, professional and business services and sales continue to add full-time jobs." For More Information Go To: http://www.careerbuilder.com Reference Checking: The Unsung Recruiting Hero If talent managers had an accurate way to help assess whether or not a potential employee was right for their organizations they would use it, right? Maybe not. Reference checking, one of the oldest and most basic recruiting techniques available, isn't as popular as it perhaps should be. Dara Herbst, president of the Certified Reference Checking Co., said many in the HR space don't use available resources such as previous employers, supervisors and co-workers to help assess applicants' suitability. "More people are concerned about the criminal aspect than they are how well [potential candidates] performed in the past," Herbst said. "Not taking the person's references before you hire them could cost the company thousands of dollars in terms of training and lost productivity. If you're not going to check the person's references, you really don't know who you're bringing in." The main reason most talent managers don't check references is it's a time-consuming process, Herbst said. But talent managers should make time up-front to ask what she calls deep, penetrating questions to uncover critical information about a candidate's strengths and weaknesses. For More Information Go To: http://www.talentmgt.com/newsletters/talent _management_perspectives/2008/April/606/index.php

Arrestfree.com Receives Award from Better Business Bureau

Arrestfree.com founder, Kenneth Coats was presented with the 2007 "Complaint Free" award by Better Business Bureau President Steve J Bernas. This award is presented to businesses that have demonstrated a commitmenet to serving its customers and have maintain zero complaints throughout the year in their business service. In the year 2007, Arrestfree.com received no complaints or issues during its first full year of operation. For More Information About ArrestFree.com visit the company's website: www.arrestfree.com

ClearStar.net Releases New Gateway Web Services

ClearStar.net, a leading provider of software-as-a-service solutions for the employment and tenant screening industry, announced today their largest ever open integration effort: Gateway Web Services. “Gateway Web Services provides developers unprecedented access to the ClearStar.net platform and expands options for direct integration and the creation of unique applications,” explained Kevin Lenahan, CTO of ClearStar.net. Entire web sites or components of a web site can now be built using Gateway to address specific business or client needs, without having ClearStar.net being directly involved in the development effort. Using Gateway to build applications allows businesses to leverage the strong security, scalable infrastructure, and business experience that are hallmarks of ClearStar.net.

For More Information Go To: www.ClearStar.net

This Month’s Challenge is sponsored by:

The 2008-2009 Background Screening Industry Buyers Guide
(Last Chance, Time is Running Out)

As the background screening industry continues to get more competitive the firms that will ultimately succeed will be those that create competitive advantage through their people by offering continuous learning opportunities to heightened their knowledge and capabilities. We believe that having employees that are very knowledgeable about the legal landscape of background screening is essential to continued success.

We are grateful to Pam Devata, Seyfarth Shaw LLP for providing the expertise for this valuable endeavor. For information regarding the answers to the Legal Challenge Questions, please contact Pamela Devata at Seyfarth Shaw LLP at pdevata@seyfarth.com or 312-460-5000 or visit www.seyfarth.com.

Please choose your answer by clicking on it:

Question #4 If I am assisting my employer client with the adverse action process, what is the best practice for sending a notification to the applicant/employee? a) Whenever he or she requests it b) After taking adverse action if the report was not procured in connection with employment purposes c) Prior to taking adverse action when the report was for employment purposes d) All of the above

Data Loss Problems Still Not A Priority At Most Companies

The tech industry's out to thwart data breaches at supermarkets, on social networks, in banks and schools, and across government and business, but it has a long way to go to get out the word about available products. Identity theft remains a big issue, yet relatively few companies plan to use data loss prevention products on their computers. In one data theft divulged in March, grocer Hannaford Bros. said hackers might have gotten credit and debit card numbers and expiration dates for as many as 4.2 million customers. Fraudulent buying reportedly followed the breach. "There's clearly a real crisis in data security right now," said Tom Corn, a vice president in data security at EMC's RSA security unit. But few firms consider data loss protection and disk encryption methods till after a problem arises, says Forrester Research analyst Natalie Lambert. "They think a full disk encryption solution is protecting the data," Lambert said. That, she says, is a misconception. "The reality is, when the machine is turned on, the data is anyone's game." Lambert says companies need a more comprehensive approach to truly protect data. Forrester found that about 25% of firms it polled in the third-quarter of 2007 employ some kind of data leak prevention system. Another 16% to 17% plan to adopt such products within 12 months. But that leaves far more than half of companies polled, most based in North American and Europe, with no specific plan to adopt technology for data loss prevention. For More Information Go To: http://www6.lexisnexis.com/publisher/EndUser?Action=UserDisplayFullDocument&orgId=563&to
picId=13710&docId=l:769214202

Employees The Weakest Link In IT Security

There is growing recognition among employers that, however much time and money they spend on ramping up their IT security, it counts for very little if they fail to change the practices and mindset of their workforce. More and more firms are clamping down on their IT security, a study in the UK by consultancy PricewaterhouseCoopers has found, with seven out of eight large businesses now claiming to have a security policy in place. But the research among more than 1,000 employers conducted with the government's Department for Business, Enterprise & Regulatory Reform has concluded that, without changing people practices, this flurry of activity is a waste of time. Yet a series of high-profile data breaches and losses of personal information by the government over the past few months may mean that attitudes are finally changing. The PwC research identified changing employee behaviour as the key to improving information security. “It is a bit like the road speed limit – everyone knows what they ought to do, but only a few actually do it. Only when behaviour changes do businesses realise the benefits of a security-aware culture," he concluded.

For More Information Go To: http://www.management-issues.com/2008/3/27/research/employees-the-weakest-link-in-it-security.asp

Whodunit? Was it the receptionist, the salesman or the building manager who gave away company secrets? Here's how to find and stop the leaks.

How far will you go to defend the privacy of your customers' and employees' personal data?

Trusting an employee with access to mission-critical or sensitive systems is a risky but unavoidable gamble. Let's face it: People are wild cards. Just as casinos thwart cheaters at every table or station on their floors, so, too, can IT officials thwart breaches by customizing security plans for individual employees in every zone of their companies. In fact, casino practices can be translated to the corporate IT world to create at a common-sense list of do's and don'ts for redoubling security based on who does what job. The lessons we learn reveal that it's never wise to entrust your business's most valuable or vulnerable assets to a single employee. Instead, compartmentalize access whenever possible, and never hesitate to look over employees' shoulders. Above all, follow the golden rule of a casino: Gauge your level of risk and develop airtight audit trails, urges Bruce Schneier, a security expert Schneier adds that "If you look at a casino floor, you will notice immediately that people are watching people," he says. Just as edgy casino managers constantly size up everyone on the floor as potential security threats, so must corporate IT security leaders size up every employee. "People are the weakest link in security. Playing by the rules is non-negotiable at casinos, where the stakes are high. Corporations that have just as much to lose must constantly communicate the same message. Only then will granting the privilege of access no longer be such a gamble.

For More Information Go To: http://www.computerworld.com/action/article.do?command=viewArt
icleBasic&articleId=315599&intsrc=hm_list

Background Screening and Investigations Managing Hiring Risk from the HR and Security Perspectives By W. Barry Nixon, SPHR and Kim Kerr, CPP 352 pages 16 ills Copyright 2008 USD 49.95, Reference Butterworth-Heinemann Title ISBN: 978-0-7506-8256-5 To Order Click Here

NAPBS Webcast Series: Will resume in MayFind out more about webinars by going to http://www.napbs.com/content.php?id=289 Courses are open to members and non members.

Snapshot of Bruce Berg’s NAPBS Conference Report

The attendance at the conference grew by 13% over last year to a whopping 689 attendees, with over 100 first timers. The quality, content and organization of this year’s conference were way beyond what I called last year as “Another bang up year for napbs and our industry.” There was so much going on it could have easily stretched into another full day.

The feedback from the 62 fellow exhibitors was very positive although they and the attendees would really have liked even more face to face time to just network, talk, meet and greet. This conference is obviously a great opportunity for the industry to meet with potential suppliers and do business.

There was much official and informal discussion on accreditation. Seems one major concern is creating a process so as to avoid litigation attorneys from attacking the napbs or its members for not including certain criteria in the accreditation or not measuring/inspecting properly. The key is to set standards, become accredited against those standards, make it affordable, yet effective, and be able to take away an accreditation, all without creating liability for the organization. The outgoing chair, Art Cohen, thinks we can work past this and the incoming chair, Larry Lambeth, feels strongly that we need to find a way. So, it looks like 2008 may be the year.

Art Cohen reported that napbs is working diligently to align with other related associations and organizations to build our power base when we need to put our position before the lawmakers. These include SHRM, ASIS, CDIA, NASA, NCRA. They are also looking to create a grievance protocol when a member is found to not be in compliance with good practices. The education sessions held monthly via webex have been quite successful with over 100 attendees per session and will continue.

Most everyone reported that sales are up in Q1 over 2007. But, people also said that based on the same customer base as 2007, Q1 sales were down for that same customer base; admitted decreases ranged from 5% to 15%. Macroeconomics is having an impact on our industry, yet the mood was still very upbeat.

To Read The Full Report Go To: http://www.bergconsultinggroup.com/id62.html

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Looking for the Top Suppliers in the Industry? Need to find a new Supplier?

Visit PreemploymentDirectory.com’s VENDOR SHOWCASE which features suppliers to the Background Screening Industry (go to www.PreemploymentDirectory.com, click on ‘Click Here’ and then scroll down to Vendor Showcase for Background Screening Industry Suppliers)

NAPBS International Education Sessions A Smashing Success

NAPBS’ venture into the international arena to establish a global alliance of professional background screening and investigations firms took another big step by hosting two educational sessions at the annual conference. With a standing room only crowd the three international speakers: Guy Underwood, CEO, RISQ Group, Australia, Tejas Sanghvi, Supersoft, India and Michael Damm, ISB, Canada did an excellent job of describing some of the essentials regarding conducting background screening in their respective countries. There was a lively question and answer session, and let us not forget the outstanding moderating by Les Rosen, ESRCheck who lent his expertise and humor to the panel discussion. The next frontier for the International Committee’s Education Committee will be to start focusing on webinars for the international screening community.

Drug And Alcohol Testing By Employers In Canada

Two significant decisions have been rendered that add clarity on the state of the law on drug and alcohol testing by employers in Canada, one by an arbitrator in Ontario and the other by the Quebec Court of Appeal. In Greater Toronto Airports Authority v. Public Service Alliance of Canada, Local 00041 ("GTAA"), Arbitrator Jane Devlin reviewed the drug and alcohol policy applicable at Toronto’s Lester B. Pearson International Airport, and in Section locale 143 du Syndicat canadien des communications, de l’énergie et du papier c. Goodyear Canada inc.2 ("Goodyear"), the Quebec Court of Appeal assessed an arbitrator’s review of Goodyear’s drug and alcohol policy. Although these decisions add some new distinctions, the traditionally accepted principles related to drug and alcohol testing by employers in Canada remain valid.A central issue in both the GTAA and Goodyear decisions was random drug and alcohol testing. Consistent with the jurisprudential trend on this issue, both Arbitrator Devlin and the Quebec Court of Appeal struck down the parts of the employers’ policies that dealt with random drug testing for employees in sensitive positions. In view of these two recent rulings, it can now be definitively asserted that random drug testing by employers in Canada is prohibited, even in safety-sensitive positions.

To Read the Full Article Go To: http://www.mondaq.com/article.asp?articleid=59398&email_access=on

JAPAN New risks from Japan’s SOX law Subsidiaries of Japanese firms are at risk as Japan introduces its own Sarbanes-Oxley Act.Subsidiaries and affiliates of Japanese firms could be exposed to risks associated with new Japanese internal controls and financial reporting laws, which came into force on April 1. J-SOX aims to improve the transparency and accountability in business processes for all Japanese listed companies. Japan's Financial Instruments and Exchange law, or J-SOX, as it is informally known, is modelled on the US' Sarbanes-Oxley Act. The law requires companies to review how risk is managed across the entire group, and focus on the risks that could create material misstatements in financial reporting. http://www.strategicrisk.co.uk/story.asp?s ource=srbreakingnews&storycode=370594  UNITED KINGDOM United Kingdom: Data Theft - An Inside Job In recent years, employers have become increasingly vulnerable to resentful employees misusing or stealing electronic data. As more and more businesses rely on technology for essential processes, it is no longer enough for them to think only in terms of controlling access to physical documents. Modern technology allows for the transfer and/or exchange of huge volumes of electronic data in a matter of minutes. Unfortunately, this means that a disgruntled or departing employee can easily destroy, steal or misuse valuable proprietary information. He/she may even choose to pass on commercially sensitive data to a competitor, leaving his/her former employer potentially exposed to a loss of profit and/or costly litigation. Businesses sometimes find that a vindictive departing employee has deleted or destroyed data and, on occasion, gone to extreme lengths to wipe all information from a computer or other electronic device. There have even been cases where equipment has been physically damaged. Prevention is better than the cure and businesses can safeguard their electronic data by introducing and enforcing policies that cover: To Read the Full Article Go To: http://www.mondaq.com/article.as p?articleid=58590&email_access=on

Business crime should be a police target

CBI downgrades 2009 economic growth to 1.7%, consumption is forecast to slow to just 1.6% this year. The CBI has downgraded its 2008 outlook for UK growth, and it forecasts even slower growth in 2009 due to continued troubles in the credit markets, rising commodity prices and weak domestic and global demand. In its latest quarterly economic forecast, the UK’s business group has lowered its figure for this year’s rate of GDP growth down 0.2% to 1.8%. At the same time as the economy slows, inflation is due to rise. The CBI expects that the CPI rate of inflation will peak at 3.2% in Q3 of 2008, forcing the Governor of the Bank of England to write a second letter to the Chancellor. This compares with 2.7% predicted in the previous forecast. Due to the slowing economy, however, inflation is expected to come down in the longer term. So, the CBI expects the Bank of England will be able to cut interest rates in the second and fourth quarters of this year, with one more reduction early next year. This would bring interest rates down to 4.5% by early 2009. Richard Lambert, the CBI’s Director-General said: ‘Having enjoyed two years of strong growth, we are now living in uncertain times. We are facing a financial shock on a scale not experienced in recent times, which is coming on top of already slower growth.

http://www.strategicrisk.co.uk/story.asp?source=srfinancial&storycode=370395

The Case Against Vetting

Checking that the people who work with our children will not endanger them seems like a sensible policy. Children are vulnerable and we don’t want to put them in harm’s way. A succession of high-profile tragedies, from the Dunblane massacre to the Soham murders has only heightened anxiety about safety. However, when everyday community activities - school discos, parent-teacher councils, local sports clubs - now require a higher level of security clearance than the selling of explosives or firearms, surely it is time to call a halt to the ever-expanding culture of vetting. Criminal records vetting was once for people in unusual positions, such as spies and judges; now millions of fathers and mothers need the all-clear before they can go on school trips, become school governors, or volunteer with the local boys’ football team. There has been almost a 100 per cent rise in the annual number of criminal checks issued by the Criminal Records Bureau (CRB) since 2002, and the CRB recently announced its ten millionth disclosure. The Safeguarding Vulnerable Groups Bill, due to return to the House of Commons next week, will mean that 9.5million adults - one third of the adult working population - will be subject to ongoing criminal checks.

For More Information Go To: http://www.spiked-online.com/index.php?/site/article/1888/

We have greatly enhanced our International Resource Center to be a valuable resource for anyone looking for information on doing international background verifications, vetting or verifications. It includes information on international data protection and other laws, terrorist searches and much more. Also included is very practical information on time zones, locating cities, holidays in different countries, etc.

New Information Added:

Standards Australia

International Training Resources

We have added International Training Resources to the International Resource Center. We will update this section as we identify new training and educational opportunities.

Bookmark this valuable resource so you can use it over and over.

To view the International Section go to www.PreemploymentDirectory.com and look under the gray line like below in the middle of the page:

Many Nonprofits Shun Volunteer Checks, Crime Victim Group Says

The National Center for Victims of Crime conducted a telephone survey of 517 nonprofit human service organizations to identify: characteristics of organizations that regularly screen volunteers, the screening methods used, and how information revealed byscreening is used in decision making. Most organizations say they conduct some screening, but few conduct thorough screening using all available methods of gathering information, including reference and background checks. In fact, one in four organizations does not call references for potential volunteers, and 27 percent do not conduct any type of background check. Less than one-third use fingerprints, the most reliable form of criminal background check. Most organizations say they would not accept a volunteer with a criminal history or a report of child or elder abuse, but some that said they would disqualify on that basis are not checking the sources of that information. For most organizations and volunteers, credit history is not an issue.

To Read the Full Report Go To: http://www.ncvc.org/ncvc/AGP.Net/Components/documentViewer/Download.aspxnz?DocumentID=44797

We invite you to pull up a chair, take a break and join us in the Background Bistro to sip a latte and chat with this weeks guest:

Barry Boes, President, Accio Data graciously agreed to talk with us. He started Accio Data with a desire to help people and to fill what he saw as an obvious technology gap in the industry. He also had a desire to be self-employed and thought the background screening industry was a good avenue to accomplish this goal. Prior to starting his own firm Barry worked in the semiconductor industry. After 911, it became obvious to him that having an efficient and reliable background check system in place moved beyond being a good idea to business necessity. He noted that hiring an employee that violates US immigration laws can cost you time and money. Even more important, he stated that hiring an

2008 Events (Click Here to View full list of 2008 Events)

SHRM State Conferences, visit http://www.shrm.org/conferences/state/CMS_004287.asp

Drug and Alcohol Testing Industry Association (DATIA), 2008 Training Course Schedule, visit http://datia.org/

National Association for Professional Background Screeners (NAPBS), 2008 Webinar Schedule, visit http://www.napbs.com/content.php?id=289

World Federation for Personnel Management, Events, http://www.wfpma.com/dates.html