This Just In - Background Checks Are Your Responsibility, Not a Recruiters...

What?  The recruiter didn't run a background check, neither did we, and we got embezzled out of $500,000?

What should we do?  Hmmm. I know, let's sue the recruiting firm!

Wrong answer. Look inward, ye company with weak processes and perhaps a weak HR function.

I don't talk about background checks much at the Capitalist. I kind of think it's a given they'll be done and done well in all of our companies.  Kind of like electricity and broadband, it's a commodity.  Still, you have to have process around commodities, or the next thing you know the toddler's sticking his tongue in the outlet and bad stuff happens.

What kind of bad stuff?  How about a local Birmingham firm (my hometown and a great place to live, by the way) that went belly up never running a background check on an executive, then getting 500 large stolen from them.  Now they want their money from the local recruiting firm.  From the AP Wire:

"Local executive search firm ITAC Solutions Inc. is being sued by a subsidiary of defunct Vesta Insurance Group Inc. for not completing a background check on an employee who misrepresented himself and eventually stole more than $500,000 from the company.

The suit stems from an executive who was found by ITAC and hired by Vesta in 2004. He claimed to have prestigious college degrees and extensive work experience, but after it was discovered he did not have the credentials – and allegedly embezzled a large sum of money – he committed suicide, according to the complaint.

J. Gordon Gaines Inc., which provided all management services for Vesta, retained ITAC for $37,500 in September 2003 to find a chief information officer for the insurance company, to be paid about $150,000 a year.

The company is seeking $900,000 in damages from ITAC and demanding a trial by jury.

Brian Pitts, owner and managing partner at ITAC, said the complaint has no merit.  “This lawsuit completely misrepresents the services we offered to Vesta Insurance Group nearly five years ago,” said Pitts in a written statement. “ITAC has successfully placed thousands of individuals throughout our company’s history and has never had a complaint such as this brought against us. The claims are completely without merit and we are confident that we will prevail in due course.”

The obvious question to ask is where was HR?  I think everyone agrees that companies should run their own background checks.  After all, who do you want making the determination on the gray areas - you or the guy/gal who's trying to net 37.5K for the placement.

The other angle that jumps out here is for recruiters.  No HR person I know has the recruiter do backgrounds for them.  Most recruiters, especially the smaller type, don't sweat having an agreement in place.  I think that's fine, but if I were on the recruiting side, this article would make me do a one page agreement when a placement was finalized, outlining what my firm did and didn't do, and what the customer takes responsibility for regarding background checks, drug screening, etc.

For a quality background check firm, check out ESS in Birmingham.  Good web tools, etc.  I inherited them when I got to Source and they'd be the first people I would call.

Comments

[Dan]

This is hilarious because I was hired from a recruiting firm and apparently this was my current company's first time using them. So AFTER I was offered the job I got a call from the recruiter asking me for info for my background check. Direct Quote:
"We never do this, but they seem to think this is part of our job."
So he proceeded to ask me for names and numbers of two people I have worked with and ended the conversation. Two Thoughts:
1. Why didn't the recruiting firm say no...I don't know crap about recruiting and I could BS a myriad of reasons why this isn't a smart idea for the company as well as the recruiting firm (More now that I have read your post)
2. I am almost positive that if the company knew how much of an eyewash background check I was getting from the recruiter they would have wanted to run their own check anyway.

Either way, I got in and I am not a felon, but looking back I probably could have been.

[Paula]

Don't we all just seem to trust really easily? That is not a good thing - trusting easily. We all should practice caution and there are background checks available. A little time spent to check an applicant's background could do wonders.