Let’s say you’ve just hired a Controller for your business. You’re giving this person responsibility over your company’s entire financial operation – cash management, banking, client receivables…the whole deal. You’re excited, because you’re finally freeing yourself up to focus on the things that you should be focusing on in order to grow your business.
The problem is, your new controller is facing personal bankruptcy. As a matter of fact, this new “dream hire” is struggling under a mountain of credit card debt, and his minimum monthly payments are taking up over 60% of his personal income. Debt collectors have filed liens against his house for unpaid bills, and credit card companies have flagged his account for multiple late payments and defaults.
Now, two questions: First, wouldn’t you want to know these things before you put this guy on the corporate checking account? Second, why didn’t you find this out until after you realized that he’s stolen over $450,000 from right out under your nose?
Such was the case with a recent client of mine, who had reported to me that their newly hired (and fired) Controller had single-handedly pilfered almost half a million dollars without anyone having the slightest clue as to what he was doing. Not only did this person have access to the company checkbook, but he was also responsible for booking the accounting entries and performing the bank reconciliations – a sure-fire recipe for fraud. He simply set up a few fictitious companies and started sending himself checks. It took two years for my client to find out what had happened…and it took a bounced a payroll check before they realized their account had been drained. Yikes.
“I couldn’t believe it,” my client told me. “Here I am, a trustworthy guy, assuming that everyone is as trustworthy as me. I nearly lost my business.” A solid employee theft insurance policy saved his company from certain ruin.
The case for conducting credit, drug, and background checks is clear and compelling. In today’s world, you can never be too careful when it comes to hiring new employees. Our increasingly electronic and networked world makes it easier and easier for unscrupulous employees to siphon off thousands of dollars over the course of months, or even years, without you having a clue until it’s too late.
Yes, conducting these necessary checks requires a bit of additional time and money. Yes, it involves an extra step in the hiring process. But, so what? Are you really prepared to take a massive financial hit because you’re “too busy” to worry about properly vetting your employees?
You need to understand that the employees who will cause you significant harm may not look like criminals. You can’t pick them out from the crowd.
It’s time for your company to set up a proper credit, drug, and background check program, right now. You’ll come to realize that it’s never worth hiring someone without putting them through this process. It’s just not worth it to cut corners.
Adam Robinson is CEO of Hireology – a web-based tool that provides customized interviews, job profiling, and one-click background checks to help companies hire the right person. Start your free trial at www.Hireology.com today!
What other steps should you take to ensure you hire the right person for the job? Find out below: