As the story below demonstrates, financial firms run the risk putting their organisations in financial peril by not conducting basic criminal searches. As a minimum media searches should always be part of a proper screening process, since they will unveil any high profile case that reached the local or national press.
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TWO Zimbabwean insurance workers based in Sheffield who plundered customers' personal details then used them to scam hundreds of thousands of pounds from policy holders have been jailed for five and-a-half years.
Failed asylum seekers Edward Dzingai, 27, and Gregory Maumbe, 26, both worked at Norwich Union's Pomona House in Pear Street, Ecclesall Road.
They used their positions to gain access to the personal insurance policy details of 28 "gone away" customers - clients for whom the company had no current address - often targeting elderly or vulnerable people.
Ian West, prosecuting, told Sheffield Crown Court: "Dzingai and Maumbe's positions in the organisation gave them access to the computer databases - the names and details of the policy holders and copies of the signatures of these 'gone away' cases.
"They would use this information to manufacture fraudulent surrender letters and the funds would then be transferred to the bank accounts detailed on these letters."
They targeted 28 policies yielding more than £655,395 between September 2005 and October 2007.
They also tried to steal a further £144,000 but failed.
When police raided their homes and examined their computers they found details of another 53 policies worth £1.5 million.
Dzingai, of Windy House Lane, Manor, and Maumbe, of Fretson Road, Manor, pleaded guilty to one count of conspiring to obtain money transfers by deception.
They claimed they were forced into the scam by men who threatened to hurt their families in Sheffield and Zimbabwe.
Maumbe admitted receiving up to £40,000 for his part in the operation, while Dzingai said he received between £1,500 and £2,000 for five different transactions.
Sentencing them to five years in prison for the deception case, plus an extra six months for possessing fake passports, His Honour Judge Patrick Robertshaw said:"You were actually possessed of freewill and made the choice to play a crucial, critical role in this fraud over a significant period of time.
"The breach of trust involved was serious, flagrant, calculated, deliberate and protracted."
The prosecution claim Allan Manhire, 26, from Liverpool, arranged the bank accounts through which the money was laundered. He faces trial at a later date.
Several other defendants, some of them UK nationals, have admitted opening bank accounts into which the money was laundered.
Friday 27 February 2009
Facebook posting can get you fired
As reported in the Times today an employee was fired as a result of a posting on Facebook. This raises interesting ethical and legal questions both in terms of checking social networking sites for employment purposes as well as in controlling what employees can say with impunity about their employer in what is essentially a form of media.
At Powerchex we do not formally check social networking sites for pre-employment screening purposes, however, we do recommend that recruiters take a look at what the applicant may have posted on Facebook and other similar sites.
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A 16-year-old girl from Essex was fired after she described her office job as "boring" on her Facebook page.
Kimberley Swann, 16, of Clacton, had been working at Ivell Marketing & Logistics, in Clacton, for three weeks before being fired on Monday.
"I think they've stooped quite low," she said.
The firm's Steve Ivell said of the decision: "Her display of disrespect and dissatisfaction undermined the relationship and made it untenable."
Miss Swann said: "You shouldn't really be hassled outside work. It was only a throw-away comment.
She says Clacton is boring but we're not going to throw her out of the house for it
Janette Swann
"I came home from work one day, sat on the computer and said something about my job being boring."
Details were passed to her employers after she allowed colleagues access to her page, Miss Swann said, adding that she was not given the chance to explain.
Her mother, Janette, 41, said: "I think she's been treated totally unfairly. She didn't mention the company's name.
"This is a 16-year-old child we're talking about. She says Clacton is boring but we're not going to throw her out of the house for it."
Mr Ivell said: "Ivell Marketing is a small, close-knit family company and it is very important that all the staff work together in harmony.
"Had Miss Swann put up a poster on the staff notice board making the same comments and invited other staff to read it there would have been the same result."
TUC general secretary Brendan Barber said employers needed "thicker skins" in relation to social networking websites.
He said: "Most employers wouldn't dream of following their staff down the pub to see if they were sounding off about work to their friends."
At Powerchex we do not formally check social networking sites for pre-employment screening purposes, however, we do recommend that recruiters take a look at what the applicant may have posted on Facebook and other similar sites.
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A 16-year-old girl from Essex was fired after she described her office job as "boring" on her Facebook page.
Kimberley Swann, 16, of Clacton, had been working at Ivell Marketing & Logistics, in Clacton, for three weeks before being fired on Monday.
"I think they've stooped quite low," she said.
The firm's Steve Ivell said of the decision: "Her display of disrespect and dissatisfaction undermined the relationship and made it untenable."
Miss Swann said: "You shouldn't really be hassled outside work. It was only a throw-away comment.
She says Clacton is boring but we're not going to throw her out of the house for it
Janette Swann
"I came home from work one day, sat on the computer and said something about my job being boring."
Details were passed to her employers after she allowed colleagues access to her page, Miss Swann said, adding that she was not given the chance to explain.
Her mother, Janette, 41, said: "I think she's been treated totally unfairly. She didn't mention the company's name.
"This is a 16-year-old child we're talking about. She says Clacton is boring but we're not going to throw her out of the house for it."
Mr Ivell said: "Ivell Marketing is a small, close-knit family company and it is very important that all the staff work together in harmony.
"Had Miss Swann put up a poster on the staff notice board making the same comments and invited other staff to read it there would have been the same result."
TUC general secretary Brendan Barber said employers needed "thicker skins" in relation to social networking websites.
He said: "Most employers wouldn't dream of following their staff down the pub to see if they were sounding off about work to their friends."
Departing workers often steal data from ex-employers: study
A study by Ponemon Institute reveals that more than half of departing employees steal data from their ex-employers. Other than the obvious implications raised concerning the data security policy or lack there of, at the site of the ex-employer, one needs to consider the fact that these employees must be quite confident that their ex-employer will not disclose this sort of information to the new employer. Given the percentage of dishonestly involved, new employers are well advised to probe into these sort of issues during the referencing process.
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Many ex-employees in the U.S. are walking off with companies' sensitive and confidential data when they leave their jobs, a new study has found.
And of those, most have either used or plan to use the data for their next job with another company.
"Not only is this putting customer and other confidential information at risk for a data breach, but it could affect companies' competitiveness and future revenues," said the study released Monday by the Ponemon Institute, a Michigan-based independent think-tank that researches information and privacy management practices in business and government.
Among 945 survey participants who had been laid off, fired, or changed jobs in the past year, 59 per cent admitted to taking company data with them, said the study, which as sponsored by Symantec Corp., the internet security company that makes Norton Antivirus.
Of those:
65 per cent took email lists.
45 per cent took non-financial business information.
39 per cent took customer information, including contact lists.
35 per cent took employee records.
16 per cent took financial information.
About 61 per cent took the data as paper documents or hard files, 53 per cent burned the information onto a CD or DVD, and 42 per cent downloaded it onto a USB memory stick.
When asked if their former company permitted them to keep the information, 79 per cent admitted that the company did not.
The study's results suggested that the stolen information was valuable to competitors — 67 per cent of the ex-employees said they used confidential, sensitive or proprietary information from their ex-employer to help secure a new job, and 68 per cent said they planned to make use of the data.
Companies share blame
The study's author suggested that companies aren't doing enough to stop the thefts:
Only 15 per cent of companies in the survey conducted a review or audit of the paper and electronic documents taken by employees.
92 per cent of employees took CDs, DVDs, USB memory sticks and PDAs with them when they left, and 89 per cent reported that the company did not do an electronic scan of the devices.
24 per cent of employees were able to access their former employer's computer system or network after their departure and 44 per cent continued to receive email on the company's account.
"Even if layoffs are not imminent, companies need to be more aware of who has access to sensitive business information," said Larry Ponemon, chairman and founder of the Ponemon Institute, in a statement. "Our research suggests that a great deal of data loss is preventable through the use of clear policies, better communication with employees, and adequate controls on data access."
Dissatisfied employees more likely to steal
The study found that only 13 per cent of respondents who had a favourable view of their former employer kept some of the company's information, while more than 61 per cent with an unfavourable view took the data.
When employees who took the data were asked why it was acceptable to do so:
54 per cent said other employees kept the information when they left the company.
50 per cent said no one checked their belongings when they left.
11 per cent said their former supervisor said it was permissible to keep the information.
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Many ex-employees in the U.S. are walking off with companies' sensitive and confidential data when they leave their jobs, a new study has found.
And of those, most have either used or plan to use the data for their next job with another company.
"Not only is this putting customer and other confidential information at risk for a data breach, but it could affect companies' competitiveness and future revenues," said the study released Monday by the Ponemon Institute, a Michigan-based independent think-tank that researches information and privacy management practices in business and government.
Among 945 survey participants who had been laid off, fired, or changed jobs in the past year, 59 per cent admitted to taking company data with them, said the study, which as sponsored by Symantec Corp., the internet security company that makes Norton Antivirus.
Of those:
65 per cent took email lists.
45 per cent took non-financial business information.
39 per cent took customer information, including contact lists.
35 per cent took employee records.
16 per cent took financial information.
About 61 per cent took the data as paper documents or hard files, 53 per cent burned the information onto a CD or DVD, and 42 per cent downloaded it onto a USB memory stick.
When asked if their former company permitted them to keep the information, 79 per cent admitted that the company did not.
The study's results suggested that the stolen information was valuable to competitors — 67 per cent of the ex-employees said they used confidential, sensitive or proprietary information from their ex-employer to help secure a new job, and 68 per cent said they planned to make use of the data.
Companies share blame
The study's author suggested that companies aren't doing enough to stop the thefts:
Only 15 per cent of companies in the survey conducted a review or audit of the paper and electronic documents taken by employees.
92 per cent of employees took CDs, DVDs, USB memory sticks and PDAs with them when they left, and 89 per cent reported that the company did not do an electronic scan of the devices.
24 per cent of employees were able to access their former employer's computer system or network after their departure and 44 per cent continued to receive email on the company's account.
"Even if layoffs are not imminent, companies need to be more aware of who has access to sensitive business information," said Larry Ponemon, chairman and founder of the Ponemon Institute, in a statement. "Our research suggests that a great deal of data loss is preventable through the use of clear policies, better communication with employees, and adequate controls on data access."
Dissatisfied employees more likely to steal
The study found that only 13 per cent of respondents who had a favourable view of their former employer kept some of the company's information, while more than 61 per cent with an unfavourable view took the data.
When employees who took the data were asked why it was acceptable to do so:
54 per cent said other employees kept the information when they left the company.
50 per cent said no one checked their belongings when they left.
11 per cent said their former supervisor said it was permissible to keep the information.
One if four have lied at interview
Recruiter magazine reveals in their weekly update a startling statistic:
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Around a quarter of British workers have lied at interview, according to a Monster poll.
According to the poll, 28% of workers admitted lying in a job interview, with a further 14% stretching the truth in the hope of appearing better qualified for a job. However, most people have remained honest, with 58% of those surveyed claiming that they have never lied or been economical with the truth to secure a job.
Julian Acquari, managing director at Monster UK and Ireland, says: “Today’s tough job market understandably heightens the temptation for jobseekers to lie in interviews. Competition is fierce and we are aware of the increased need to stand out.
“However, there is a fine line between embellishing facts about yourself and telling lies. It is never advisable to bend the truth under any circumstances as it is likely to catch up with you. At the end of the day honesty is always the best policy.”
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Around a quarter of British workers have lied at interview, according to a Monster poll.
According to the poll, 28% of workers admitted lying in a job interview, with a further 14% stretching the truth in the hope of appearing better qualified for a job. However, most people have remained honest, with 58% of those surveyed claiming that they have never lied or been economical with the truth to secure a job.
Julian Acquari, managing director at Monster UK and Ireland, says: “Today’s tough job market understandably heightens the temptation for jobseekers to lie in interviews. Competition is fierce and we are aware of the increased need to stand out.
“However, there is a fine line between embellishing facts about yourself and telling lies. It is never advisable to bend the truth under any circumstances as it is likely to catch up with you. At the end of the day honesty is always the best policy.”
Increase in IT contractors' offers in Financial Services
Powerchex's own research of the number of offers make in the month of January as they compare to the month of December 2008, show a significant increase in offers primarily in investment banking. IT contractors' offers have also increased substantially. Contractor UK a leading industry website reports our findings as follows:
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Recruitment of IT contractors by British financers has beaten all stated expectations, halting a consecutive monthly decline in the number of IT freelancers that they hire.Financial staff screening firm Powerchex said IT contractor job offers in January rose by almost 30% compared with December, when they went into the red by 75%.Yet the number of IT contractors the firm screened last month was down 68% on the same period in 2008, suggesting City IT hires are “definitely not back to normal.” Reflecting on January’s upturn, Powerchex’s founder Alexandra Kelly told CUK it may be that financers think that they shed too many IT contractors in December. Then, the number of IT contractor job offers was “dismal, so much so that investment bankers, stockbrokers, insurers and hedge fund managers were all likelier recruits.Now, however, some hiring freezes have melted, projects are being looked at afresh and related staff are being seen as vital for “competitive advantage,” Ms Kelly said. Financial services companies taking this approach with IT contractors in January were mainly serving the investment banking and insurance sectors.“There do seem to be signs of some increased hiring for contractors in the financial services space,” testified Paul Elworthy, financial IT recruitment director at Hudson.“But I would loathe to refer to it as a recovery quite yet. January is usually the beginning of the new budgets so there is a little more freedom to hire so the change from December to January can be quite a positive one. “I would put it down to a seasonal trend but that said, we are seeing more positivity from a number of our clients in their hiring, particularly for IT contractors”.Hudson said 70% of candidates it placed last month were freelance, with demand strongest for Subject Matter Experts in specific technologies, product lines or disciplines.
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Recruitment of IT contractors by British financers has beaten all stated expectations, halting a consecutive monthly decline in the number of IT freelancers that they hire.Financial staff screening firm Powerchex said IT contractor job offers in January rose by almost 30% compared with December, when they went into the red by 75%.Yet the number of IT contractors the firm screened last month was down 68% on the same period in 2008, suggesting City IT hires are “definitely not back to normal.” Reflecting on January’s upturn, Powerchex’s founder Alexandra Kelly told CUK it may be that financers think that they shed too many IT contractors in December. Then, the number of IT contractor job offers was “dismal, so much so that investment bankers, stockbrokers, insurers and hedge fund managers were all likelier recruits.Now, however, some hiring freezes have melted, projects are being looked at afresh and related staff are being seen as vital for “competitive advantage,” Ms Kelly said. Financial services companies taking this approach with IT contractors in January were mainly serving the investment banking and insurance sectors.“There do seem to be signs of some increased hiring for contractors in the financial services space,” testified Paul Elworthy, financial IT recruitment director at Hudson.“But I would loathe to refer to it as a recovery quite yet. January is usually the beginning of the new budgets so there is a little more freedom to hire so the change from December to January can be quite a positive one. “I would put it down to a seasonal trend but that said, we are seeing more positivity from a number of our clients in their hiring, particularly for IT contractors”.Hudson said 70% of candidates it placed last month were freelance, with demand strongest for Subject Matter Experts in specific technologies, product lines or disciplines.
Monday 9 February 2009
Regulators within EU countries
This is a link to all the financial regulators in the European Union. These records are kept at the country level and regulation can still vary even within the EU. Keeping in touch with local regulators and incorporating their directives has been at the cornerstone of our screening process.
http://www.jmlsg.org.uk/bba/jsp/polopoly.jsp?d=773&a=9912
On the JMLSG website, there are other resources outlining the ML regulations and how they can affect the requirements of firms in terms of screening current and future employees.
http://www.jmlsg.org.uk/bba/jsp/polopoly.jsp?d=773&a=9912
On the JMLSG website, there are other resources outlining the ML regulations and how they can affect the requirements of firms in terms of screening current and future employees.
A flood of fake CVs for IT jobs
According to The Times of India fake CVs and qualifications are flooding the Indian IT market. This trend represents a real danger to companies outsourcing IT development to India on more than one front. There is the obvious risk that the person may have a false or stolen identity and could be working on behalf of organised crime. A further risk is that the employee is not qualified for the role they will be doing and can cause serious damage to the IT infrastracture of the client. Companies are advised to not let their guards down when outsourcing any part of their work whether it is in the UK or internationally. Auditing the screening arrangements of a supplier is basic risk mitigation.
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BANGALORE: Not content with faking passports, visas and CVs, expert forgers are also meeting the needs of dubious IT aspirants. moolah by selling fake access and identity cards, appointment letters, pay revision letters, bank statements
Agents across the country are raking in the , and even relieving letters of companies and banks. A fortnight ago, Wipro Technologies interviewed a candidate who walked into its MG Road office with a whole bunch of fake documents, including an interview call letter from Wipro. Its HR staff smelt a rat and on interrogation, they uncovered the true extent of the candidate’s duplicity. Wipro let the Andhra Pradesh-based fraudster go after obtaining a written apology, in which he wrote, “I went to a shopping mall in Bangalore. There I met a job consultant. I paid him Rs 3,000 and in turn he got me fake certificates, ID card, offer letter, letter of salary hike, pay slips and bank statements. With these, I applied for a techie’s job in Wipro." An e-mail interview call letter received by another candidate had the following details: "Dear candidate, your resume is found on TimesJobs.com and you have been selected for the job you sought for. Your interview will be held on February 10 at Wipro’s Noida office. You have to come with photo copies of all required documents. First you have to deposit Rs 5,300 in any branch of a bank (name withheld) in the account number XXX in favour of Sr HRD. This money along with your travel allowance and DA will be refunded by the company on the day of the interview." Wipro has taken a serious view of the matter and even shared some cases with its peers. “It’s a serious menace growing in alarming proportions. We have given special training to our talent acquisition team to be extremely cautious of such questionable elements trying to creep into the system. We are talking to ten of our peers so that together we can find ways to fight the menace. The idea is to create a pool of fake CVs and share them between us so that we are insulated. This will also create awareness in the market," said Pradeep Bahirwani, vice-president, talent acquisition
, Wipro Technologies. According to Bahirwani, candidates from secondary cities easily fall prey to these "agents". According to a recent KPMG report, one of every four CVs in the Indian tech space is fake. Also, six of every ten fake CVs have a direct or indirect link to Hyderabad.
The Times of India
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BANGALORE: Not content with faking passports, visas and CVs, expert forgers are also meeting the needs of dubious IT aspirants. moolah by selling fake access and identity cards, appointment letters, pay revision letters, bank statements
Agents across the country are raking in the , and even relieving letters of companies and banks. A fortnight ago, Wipro Technologies interviewed a candidate who walked into its MG Road office with a whole bunch of fake documents, including an interview call letter from Wipro. Its HR staff smelt a rat and on interrogation, they uncovered the true extent of the candidate’s duplicity. Wipro let the Andhra Pradesh-based fraudster go after obtaining a written apology, in which he wrote, “I went to a shopping mall in Bangalore. There I met a job consultant. I paid him Rs 3,000 and in turn he got me fake certificates, ID card, offer letter, letter of salary hike, pay slips and bank statements. With these, I applied for a techie’s job in Wipro." An e-mail interview call letter received by another candidate had the following details: "Dear candidate, your resume is found on TimesJobs.com and you have been selected for the job you sought for. Your interview will be held on February 10 at Wipro’s Noida office. You have to come with photo copies of all required documents. First you have to deposit Rs 5,300 in any branch of a bank (name withheld) in the account number XXX in favour of Sr HRD. This money along with your travel allowance and DA will be refunded by the company on the day of the interview." Wipro has taken a serious view of the matter and even shared some cases with its peers. “It’s a serious menace growing in alarming proportions. We have given special training to our talent acquisition team to be extremely cautious of such questionable elements trying to creep into the system. We are talking to ten of our peers so that together we can find ways to fight the menace. The idea is to create a pool of fake CVs and share them between us so that we are insulated. This will also create awareness in the market," said Pradeep Bahirwani, vice-president, talent acquisition
, Wipro Technologies. According to Bahirwani, candidates from secondary cities easily fall prey to these "agents". According to a recent KPMG report, one of every four CVs in the Indian tech space is fake. Also, six of every ten fake CVs have a direct or indirect link to Hyderabad.
The Times of India
Monday 2 February 2009
Companies should be very vigilant in screening their employees as fraud nears record levels
As the global economic downturn takes hold it is very likely that more fraud will come to light. Tightening economic conditions are likely to both reveal existing frauds, or act as an determinant for new frauds. Companies are urged to screen new employees carefully and not neglect to periodically re-screen employees in high risk functions.
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The BBC On Line reports:
While fraud by professional gangs remained pretty constant, fraud by individuals increased dramatically.
Individual cases of fraud accounted for around £300m, a three-fold increase on 2007.
Professional gangs accounted for £806m.
The financial services sector suffered from £388m of alleged fraud - a 10-fold increase on 2007. However, £220m of this total was accounted for by an alleged £220m attempt to hack into Sumitomo Matsui Banking Corporation's systems.
Companies were badly hit, with a five-fold increase in fraud, up from £24m worth of cases in 2007 to £125m last year.
"Internal frauds are becoming more prevalent and should set alarm bells ringing within organisations. In difficult times, they could even become the tipping point between the survival and demise of an organisation," said Mr Patel.
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The BBC On Line reports:
While fraud by professional gangs remained pretty constant, fraud by individuals increased dramatically.
Individual cases of fraud accounted for around £300m, a three-fold increase on 2007.
Professional gangs accounted for £806m.
The financial services sector suffered from £388m of alleged fraud - a 10-fold increase on 2007. However, £220m of this total was accounted for by an alleged £220m attempt to hack into Sumitomo Matsui Banking Corporation's systems.
Companies were badly hit, with a five-fold increase in fraud, up from £24m worth of cases in 2007 to £125m last year.
"Internal frauds are becoming more prevalent and should set alarm bells ringing within organisations. In difficult times, they could even become the tipping point between the survival and demise of an organisation," said Mr Patel.
India tightens pre-employment screening practices after Mumbai attacks
Many stories of lax pre-employment screening have be reported out of India. The attacks in Mumbai are finally making companies and authorities, look close at their vetting processes as reported in the Hindu Business Line below:
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Shaken by the magnitude of the terror that struck the two hotels in Mumbai, companies across industries would step up employee verification procedures, especially for contract employees and those employed in ‘sensitive positions’ such as security staff, hospitality and airlines frontline staff and telecom employees.
Mr Rajesh A R, Vice-President of staffing solutions company TeamLease Services says that for ‘sensitive positions,’ there is likely to be additional verifications like checking permanent addresses, apart from routine education and previous employment checking.
“Before the Mumbai incident, companies did not feel the need to spend the money on additional checks such as these, especially for employees whose salaries were about Rs 4,000-Rs 5,000/ month.” Companies will therefore prefer to employ people who come with third party verification. “Candidates who have got themselves verified would stand a better chance of being employed,” he feels.
Very soon, he believes, this would also become mandatory for temp (contract) employees in the hospitality, airline, BFSI, retail and telecom sectors.
Col Vijay Reddy, Director of Footprints, a background screening firm, says that he has been recommending permanent residence verification of employees to all his clients, especially for contract staff in security agencies and the hospitality sectors.
“Now, they realise that people from the neighbouring region can easily pass off for Indians unless verified for permanent residency and that also by an independent agency.”Police verification
The hospitality sector, meanwhile, says the industry has been going through the usual procedure of identity checks. According to Ms Harinder Singh, General Manager, The Lalit Ashok, Bangalore, the hotel does go through the proper process of verifying for some positions. “We make sure there is police verification and identity checks too,” she says.
Mr Subrata Majumder, General Manager, The Park, Bangalore, says, “We make sure we demand police verification for various positions. We check documents, but how genuine they are is definitely a concern.”
In the meantime Aislinn Simpson of the Telegraph reports...
Indian call centre manager arrested over British insurance scam
The manager of an Indian call centre handling the insurance details of hundreds of British customers has been arrested over fears of a major scam, according to police.
According to the police, Edward Burns, an Indian citizen, was working in the insurance claims division of Delhi-based EXL, which handled British insurance firm Aviva, the parent company of Norwich Union.
The 30-year-old is feared to have been using identities of British insurance customers to make false claims for up to two years.
He has admitted siphoning off nearly £57,000 to bank accounts in Britain but this is only in relation to 12 customers and police believe the scam could be much larger.
They also fear that other British firms who hold accounts with EXL may have been affected.
The local head of police, Ashok Kumar Chaturvedi, said police also plan to interrogate three people thought to be accomplices of Mr Burns in Britain.
He said: "As this has been going on for two years, we suspect a much bigger financial fraud to British customers."
It is not yet clear how Mr Burns is alleged to have perpetrated the fraud, but it is understood that police believe his accomplices in Britain would collect the insurance payout and take a cut out to him in India.
EXL Service has played down the scale of the alleged scam, saying it was a "small-scale isolated incident".
A spokesman for Aviva said: "We can confirm that, through our own control mechanisms, we have discovered an isolated case of fraud by an employee of one of our supplier partners. We are currently working with the local authorities to take the appropriate action. At no time was any policy holders' money at risk."
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Shaken by the magnitude of the terror that struck the two hotels in Mumbai, companies across industries would step up employee verification procedures, especially for contract employees and those employed in ‘sensitive positions’ such as security staff, hospitality and airlines frontline staff and telecom employees.
Mr Rajesh A R, Vice-President of staffing solutions company TeamLease Services says that for ‘sensitive positions,’ there is likely to be additional verifications like checking permanent addresses, apart from routine education and previous employment checking.
“Before the Mumbai incident, companies did not feel the need to spend the money on additional checks such as these, especially for employees whose salaries were about Rs 4,000-Rs 5,000/ month.” Companies will therefore prefer to employ people who come with third party verification. “Candidates who have got themselves verified would stand a better chance of being employed,” he feels.
Very soon, he believes, this would also become mandatory for temp (contract) employees in the hospitality, airline, BFSI, retail and telecom sectors.
Col Vijay Reddy, Director of Footprints, a background screening firm, says that he has been recommending permanent residence verification of employees to all his clients, especially for contract staff in security agencies and the hospitality sectors.
“Now, they realise that people from the neighbouring region can easily pass off for Indians unless verified for permanent residency and that also by an independent agency.”Police verification
The hospitality sector, meanwhile, says the industry has been going through the usual procedure of identity checks. According to Ms Harinder Singh, General Manager, The Lalit Ashok, Bangalore, the hotel does go through the proper process of verifying for some positions. “We make sure there is police verification and identity checks too,” she says.
Mr Subrata Majumder, General Manager, The Park, Bangalore, says, “We make sure we demand police verification for various positions. We check documents, but how genuine they are is definitely a concern.”
In the meantime Aislinn Simpson of the Telegraph reports...
Indian call centre manager arrested over British insurance scam
The manager of an Indian call centre handling the insurance details of hundreds of British customers has been arrested over fears of a major scam, according to police.
According to the police, Edward Burns, an Indian citizen, was working in the insurance claims division of Delhi-based EXL, which handled British insurance firm Aviva, the parent company of Norwich Union.
The 30-year-old is feared to have been using identities of British insurance customers to make false claims for up to two years.
He has admitted siphoning off nearly £57,000 to bank accounts in Britain but this is only in relation to 12 customers and police believe the scam could be much larger.
They also fear that other British firms who hold accounts with EXL may have been affected.
The local head of police, Ashok Kumar Chaturvedi, said police also plan to interrogate three people thought to be accomplices of Mr Burns in Britain.
He said: "As this has been going on for two years, we suspect a much bigger financial fraud to British customers."
It is not yet clear how Mr Burns is alleged to have perpetrated the fraud, but it is understood that police believe his accomplices in Britain would collect the insurance payout and take a cut out to him in India.
EXL Service has played down the scale of the alleged scam, saying it was a "small-scale isolated incident".
A spokesman for Aviva said: "We can confirm that, through our own control mechanisms, we have discovered an isolated case of fraud by an employee of one of our supplier partners. We are currently working with the local authorities to take the appropriate action. At no time was any policy holders' money at risk."
A tale of two references...
This week brought two interesting stories about referencing. Two companies, one in the US, the other in Australia, reacted quite differently to adverse referencing. What would you do?
First, Microsemi as reported in the FT by Richard Waters
In spite of the new spirit of puritanism sweeping through US boardrooms, some chief executives are still being forgiven an occasional lapse into dishonesty.
That was the stance taken this week by directors of Microsemi, a small Californian technology company, after it was revealed that the company's chief executive had been less than forthright about his educational qualifications.
Rather than showing Jim Peterson the door - the fate that has often befallen other chief executives who have lied about their credentials - Microsemi's directors have decided that he should stay on, although with financial penalties that could cost him $1m.
News of the board's leniency drew a mixed reaction. "It's one data point about a person, about their willingness to falsify a record in a tight spot," said Wayne Norman, professor of ethics and philosophy at Duke University.
He added, though, that the company's directors were right to take a broader view of Mr Peterson's conduct over a number of years, and to consider the impact on shareholders of making a leadership change.
Justifying the decision not to jettison the chief executive after his nine years at the helm, Dennis Leibel, chairman, said: "The board's mission is to protect shareholder interests by balancing the results of the independent inquiry against the great value and strategic vision that Jim Peterson has created at Microsemi." He credited the chief executive with building a "highly successful and profitable enterprise".
Complicating the case was the fact that the disclosure about Mr Peterson's false credentials was made by Barry Minkow, a short-seller who has a track record of profiting by uncovering such irregularities.
The work of short-sellers in ferreting out discrepancies like this probably helped in the longer term to keep chief executives honest, said Mr Norman.
In a regulatory filing, Microsemi said that an investigation by law firm Munger Tolles & Olson had concluded that Mr Peterson did not have a bachelor's degree and MBA from Brigham Young University, as he had claimed.
Instead, he had been awarded an associate's degree by a college that later became part of Brigham Young, and had also earned "substantial credits" towards a bachelor's degree at the university.
Microsemi said it would impose financial penalties on Mr Peterson, while also introducing a heightened level of scrutiny that would involve deeper background checks into its senior executives.
While adding that the company "takes this matter very seriously", Mr Leibel stopped short of criticising the chief executive's dishonesty directly and said the company's directors "are not commenting on his beliefs, understandings or state of mind".
Meanwhile, in Australia...
A COMPANY has won more than $160,000 compensation from a recruitment firm that recommended a manager who was a former bankrupt and fraud.
The firm failed to conduct adequate background checks on the sales manager, who subsequently defrauded the company of $120,000.
Sydney water treatment equipment supplier Wedeco hired Driver Recruitment, trading as Authorised Solutions, to find sales manager for Southeast Asia, reports The Australian.
According to a NSW Court of Appeal judgment, the successful candidate, Stephen Riddell, worked for Wedeco for 18 months before it was discovered that his qualifications were false.
Wedeco found Riddell was an undischarged bankrupt and that "in his business activities he had engaged in fraudulent practices''.
Wedeco sought damages for breach of contract and for negligence and recovery of loss suffered.
The court heard that when the recruiter put forward Mr Riddell for the job, his CV said he had been employed as an area manager with another company, Tyco, for the past two years
In reality, Mr Riddell had stopped working for Tyco 5 months earlier.
Two Tyco employees nominated by Mr Riddell as referees said that when asked for a reference, they told the recruiter he no longer worked for the company and they could not speak about his work performance.
His former supervisor said that had the recruiter contacted him, he would have said Mr Riddell had had two warnings and that he was in the process of recommending his sacking when Riddell resigned.
The court found the recruitment firm breached its contract with Wedeco and its duty of care because the company failed to speak to the two referees.
It was ordered to pay $164,224 to Wedeco.
First, Microsemi as reported in the FT by Richard Waters
In spite of the new spirit of puritanism sweeping through US boardrooms, some chief executives are still being forgiven an occasional lapse into dishonesty.
That was the stance taken this week by directors of Microsemi, a small Californian technology company, after it was revealed that the company's chief executive had been less than forthright about his educational qualifications.
Rather than showing Jim Peterson the door - the fate that has often befallen other chief executives who have lied about their credentials - Microsemi's directors have decided that he should stay on, although with financial penalties that could cost him $1m.
News of the board's leniency drew a mixed reaction. "It's one data point about a person, about their willingness to falsify a record in a tight spot," said Wayne Norman, professor of ethics and philosophy at Duke University.
He added, though, that the company's directors were right to take a broader view of Mr Peterson's conduct over a number of years, and to consider the impact on shareholders of making a leadership change.
Justifying the decision not to jettison the chief executive after his nine years at the helm, Dennis Leibel, chairman, said: "The board's mission is to protect shareholder interests by balancing the results of the independent inquiry against the great value and strategic vision that Jim Peterson has created at Microsemi." He credited the chief executive with building a "highly successful and profitable enterprise".
Complicating the case was the fact that the disclosure about Mr Peterson's false credentials was made by Barry Minkow, a short-seller who has a track record of profiting by uncovering such irregularities.
The work of short-sellers in ferreting out discrepancies like this probably helped in the longer term to keep chief executives honest, said Mr Norman.
In a regulatory filing, Microsemi said that an investigation by law firm Munger Tolles & Olson had concluded that Mr Peterson did not have a bachelor's degree and MBA from Brigham Young University, as he had claimed.
Instead, he had been awarded an associate's degree by a college that later became part of Brigham Young, and had also earned "substantial credits" towards a bachelor's degree at the university.
Microsemi said it would impose financial penalties on Mr Peterson, while also introducing a heightened level of scrutiny that would involve deeper background checks into its senior executives.
While adding that the company "takes this matter very seriously", Mr Leibel stopped short of criticising the chief executive's dishonesty directly and said the company's directors "are not commenting on his beliefs, understandings or state of mind".
Meanwhile, in Australia...
A COMPANY has won more than $160,000 compensation from a recruitment firm that recommended a manager who was a former bankrupt and fraud.
The firm failed to conduct adequate background checks on the sales manager, who subsequently defrauded the company of $120,000.
Sydney water treatment equipment supplier Wedeco hired Driver Recruitment, trading as Authorised Solutions, to find sales manager for Southeast Asia, reports The Australian.
According to a NSW Court of Appeal judgment, the successful candidate, Stephen Riddell, worked for Wedeco for 18 months before it was discovered that his qualifications were false.
Wedeco found Riddell was an undischarged bankrupt and that "in his business activities he had engaged in fraudulent practices''.
Wedeco sought damages for breach of contract and for negligence and recovery of loss suffered.
The court heard that when the recruiter put forward Mr Riddell for the job, his CV said he had been employed as an area manager with another company, Tyco, for the past two years
In reality, Mr Riddell had stopped working for Tyco 5 months earlier.
Two Tyco employees nominated by Mr Riddell as referees said that when asked for a reference, they told the recruiter he no longer worked for the company and they could not speak about his work performance.
His former supervisor said that had the recruiter contacted him, he would have said Mr Riddell had had two warnings and that he was in the process of recommending his sacking when Riddell resigned.
The court found the recruitment firm breached its contract with Wedeco and its duty of care because the company failed to speak to the two referees.
It was ordered to pay $164,224 to Wedeco.
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