May 3rd, 2012 by admin
No comments »
The phrase “fit and proper” test has been in the news recently with respect to media ownership and in particular whether an individual is a fit and proper person to be responsible for a media publishing or broadcasting company. However the fit and proper test has for many years been adopted by the FSA as part of its process in assessing whether an individual can be registered as an “approved person” for specific roles within the financial services sector.
The FSA publishes a document known as the FSA handbook and within this there is a specific reference to the assessment criteria to be used in assessing whether some meets the requirement to be an approved person. The criteria, often referred to as the “FIT” test is based on three core attributes, these are:
Honesty
Integrity
Reputation
These are the fundamental pillars in assessing the suitability for approved persons but equally they can be applied to almost any type of employment. If you would like to know more about the FIT test or screening criteria for other types of employment then call Credit Check Services on 01992 719 234, they will be only too happy to assist.
March 30th, 2012 by admin
No comments »
Checking the background of tenants is often neglected by landlords, all too often a check involves asking a few questions and a bit of intuition. According to our research one of the areas most commonly overlooked is verifying the tenant’s identity, and yet this is the most important aspect of any tenant check.
Checking a tenant before letting can be summarised in four key areas:
1 – Verify the identity
2 – The tenant’s financial background (adverse history)
3 – Rent affordability
4 – The tenant’s character.
There can never be a 100% guarantee that a tenant will work out satisfactorily, and often this is also a factor of the relationship the landlord maintains with the tenant, however it is taking a huge risk to let a property without carrying adequate tenant checks.
For a more detailed overview on checking tenants read more here: How to check tenants.
March 6th, 2012 by admin
No comments »
The government is seeking new legislation subsequent to the Rehabilitation of Offenders Act 1974 in respect of changes to the periods before an offender is deemed to have a spent conviction (rehabilitation period). Full details are awaited but here are some of the changes expected:
- Where custodial sentences are applied the rehabilitation period will run from the date the person is released from prison rather than at the commencement of the sentence.
- For someone sentenced to between 6 months and 30 months there is currently a rehabilitation period of 10 years, this is expected to be reduced to 4 years.
- If a person has been convicted and awarded a community order the current rehabilitation period is 5 years, this is expected to be reduced to one year from the end of the community order.
- Where a person has been given an absolute discharge there is currently a rehabilitation period of 6 months, there is expected to be no rehabilitation period under the new legislation.
March 6th, 2012 by admin
No comments »
The revised timetable is aimed at smaller employers, any companies employing 250 or more staff will not be affected.
Previously the timetable for employers with less than 50 staff were part of a phased-in auto enrolment from April 2014. The new timetable now extends the date for automatic enrolment to May 2015, giving smaller employers up to an additional 13 months.
The overall timescales are such that all employers ware required to have their staff enrolled by April 2017. There amount of employer contribution toward employee pensions is also being phased in such that full contributions are required from 1st October 2018.
January 27th, 2012 by admin
No comments »
All too often businesses fail to carry out adequate verification of identity on clients and sometimes even employees. It is fundamentally important to be aware that there are two key steps to identity verification.
Step 1 – Physical verification
The physical check will include checking a photo ID such as a passport, cross referencing this with other documentation such as an official letter confirming the person’s name and address.
Step 2 – Electronic verification
The electronic verification, such as that carried out by Credit Check Services, will search for identity verifications comprising name, date of birth and address. When multiple records confirm a match there is a higher degree of certainty about the individual’s identity.
Further checks can also be conducted by using the data found form electronic verification to question the individual about their identity. Such data may include applications for credit, alias names, undisclosed addresses, and associations.
For more information on identity verification visit Credit Check Services.
January 24th, 2012 by admin
No comments »
A question that is often asked by employees, tenants, and others whom have been asked for their permission to carry out a credit check. Here we hope to provide some clarity and dispel some misconceptions.
The basic credit check
The fundamental components of a basic check are identification of any court enforced actions against the individual or data subject. These will cover:
- County Court Judgements (CCJs) detailing the date of the judgement, the amount of the award made, and the court reference. If the CCJ has been satisfied, that is debt repaid, then this will also be recorded along with the date satisfied.
- Bankruptcy order detailing the date of the order, the amount awarded, and the court reference. Unlike CCJs a bankruptcy order will not always have an amount of award associated with it. If the court records show that the bankruptcy has been satisfied then a date will also be given for this event.
- IVAs, these are voluntary agreements for insolvency. Similar to the bankruptcy order there will again be dates and court references.
Additional areas a credit check can cover.
- Risk scores identifying the potential risk of default on financial payments.
- Corrections recorded against an individual’s credit file. For example, someone may feel that a CCJ was incorrectly recorded or that there we other related factors they wish to be recorded.
- Credit searches, normally relating to applications for credit. When someone applies for a financial loan or credit agreement such as a mobile phone account, a search is normally conducted and a record of the event is recorded on the individual’s credit file.
- A summary of financial accounts maintained by an individual at their address, this is sometimes used to confirm an individual’s identity and address history.
- CIFAS records. This is available to members of CIFAS only. The database will record instances of employee fraud and related events.
- HM Treasury and OFAC sanctions lists. These lists maintain details of individuals and sometimes organsiations convicted of fraud, or banned from investment, or suspected of involvement with terrorism (as recorded in the OFAC list).
Personal details on the individual’s credit file not revealed.
Due to data protection requirements details such as whether an individual has missed financial payments, the total amount of credit, and the specific companies providing credit, will not be revealed for the purpose of a tenant or employee credit check. Such details can only be provided in very specific circumstances.
Who should undertake a credit check?
A short answer is any landlord or employer who feels that an individual with adverse financial history will be a risk to their business or customers. There are also regulations that apply to certain areas of employment such as within the financial services sector and security sector.
How often should a credit check be undertaken?
This really depends on the business and the degree of risk mitigation required. It should be noted that a credit check can only ever provide a view for a specific point in time. Adverse financial data is normally removed from an individual’s credit file after 6 years. Additionally a CCJ or bankruptcy order may be pending and could show up against an individual a few months after a report has been provided. It is quite common for businesses to request a credit check annually but in some cases they are conducted every 3 to 4 months.
Impact of a credit check on an individual’s credit file
Every search carried out will leave a record, so whether a search is for employment screening, tenant checks, utility services, or loan application, there will be a record kept. When an individual applies for a loan the lender will normally take into account other credit applications when determining the level of risk. A credit check (as conducted by Credit Check Services) for purpose of employment screening or tenant checks will not affect the individual’s personal credit score or their ability to obtain credit.
For more information on tenant or employee credit checks visit Credit Check Services , specialists in the background screening of individuals.
January 5th, 2012 by admin
No comments »
Some updates for changes affecting UK employment from 2012
EU Single Permit Directive
A “single permit directive” is being introduced within the EU to simplify processes and afford more rights to a non EU national working within an EU member country. The directive will cover aspects such as basic working conditions and recognition of educational and professional qualifications. It is expected that the new directive will be introduced by all EU member countries by the end of 2014.
SSP (Statutory Sick Pay) and SMP (Statutory Maternity Pay)
For 2012 there will be increases in both SSP and SMP rates. SSP will increase from £81.60 to £85.85, an effective increase of 5.2%. The SMP rate will increase from £102 to £107, an effective increase of 4.9%. The new rates will come into effect for all employees from 6 April 2012.
Employment Tribunal Fees
Currently it is free for anyone taking a claim to the Employment Appeal Tribunal (EAT), all costs are met from tax revenues. New proposals are now being considered where either a contribution or a fixed fee is to be paid by the claimant. Under one option the fees will be categorised according to the level and financial amount of the claim with fees ranging from £200 to £1,750.
It is hoped that the introduction of the new fees will minimise vexatious claims however there are some concerns that the level of claims made against employers could rise. The consultation period closes in March 2012 after which more details will be published on the proposed changes.
Employee Compensation for Redundancy and Unfair Dismissal
From 1st February 2012 the basis for calculating minimum redundancy pay will increase from £400 to £430 per week, an effective increase of 7.5%
Also from 1st February there will be an increase in the limit on the amount payable for unfair dismissal from £68,400 to £72,300, an effective increase of 5.7%.
November 30th, 2011 by admin
No comments »
Over the last 12 months we analysed searches carried out for adverse financial history, that is people who have CCJs, bankruptcy, IVA, or Debt Management Orders. The objective of the analysis was to identify the average frequency of adverse data and also the likelihood of finding the data associated with the individual’s current or disclosed address.
Frequency of adverse background data.
For tenant financial background checks we found that on average there was one instance of adverse data per 9 tenants checked. The highest value of outstanding CCJs found against an individual was £390,767, the lowest value found for a CCJ was just £55, and the average in CCJs outstanding (for a tenant with debt defaults) was £1,903.
For employee financial background checks we found on average a much lower incidence of adverse data with less than one instance per 30 employees checked. The highest incidence was in the security sector (security guarding) where we found 1 in 14 employees with adverse financial history. Conversely within the banking sector we found an average of 1 in 120 with adverse financial history.
Association of financial background data with the current (or disclosed) address provided
We found 47% of adverse financial data incidents to be associated with a previous or non-disclosed address. The incidence is skewed by the tenant sector where individuals move more frequently and thus adverse data is more commonly not associated with the current address provided. This reinforces that need to carry out thorough background checks to ensure that the person provides a valid identity for their current address and also that any searches carried out do include a full linked address search.
July 21st, 2011 by admin
No comments »
Reported in the news on 21 July 2011 was the issue of whether the office at No 10 should have carried out background checks on Andy Coulson. What would this have found and would it have made any difference to Andy Coulson’s appointment?
Background checks (or pre employment screening) are becoming increasingly widespread in their use for UK employers. Such checks enable employers to investigate and verify a considerable level of background information including information not disclosed by the prospective employee.
If the employment is related to UK Government, as in the case of Andy Coulson, then higher levels of screening can be undertaken, these are: CTC, SC and DV (for more information on security vetting visit http://www.credit-check-services.co.uk/employment/security-vetting.html ). Excluding CTC, SC and DV, the main areas covered by pre employment screening are:
- Criminal background; this can identify information recorded by the courts or by the police ranging from criminal convictions through to arrests, cautions, fines, etc.
- Financial background; this can identify a range of data from civil court enforced debts to debt management orders, credit searches undertaken, account verifications, etc.
- Qualifications and professional memberships; these can be verified for legitimacy.
- Employment history; this can range from confirming periods of appointments and salaries through to performance related information.
- Identity; verification, immigration status, and the right to work in UK.
- Sanctions; to confirm if the individual is subject to any UK or national sanctions, typically HM Treasury and the USA OFAC databases.
- Company legal appointments; identifying current and past appointments and any disqualifications (e.g. from appointment as company director or company secretary).
By carrying out higher levels of security screening (CTC, SC and DV) the investigation extends further to cover the financial situation of the applicant, information on family and relatives, and any information that could be considered to put the applicant in a position where they could be influenced to undermine their employment, for example being bribed to obtain information for a third party.
July 14th, 2011 by admin
No comments »
Following recent news headlines about journalists illegally accessing personal data there has been much discussion about the “fit and proper” test and in particular how such a test could be applied by Ofcom with respect to the future ownership of BSkyB. So what is a “fit and proper” test?
Fundamentally a fit and proper test is subjective, it is applied in context of a role or position to be undertaken. For example if you were to apply such a test to a Doctor or GP then it would be very different to a fit and proper test of someone who is to control a large media organisation.
For some employment roles the fit and proper test has been developed and documented with detailed guidelines. The FSA for example has already dealt with the issue of a “fit and proper test”, comprehensive details are published in the FSA handbook. The FSA test, which is applied to all FSA approved persons, is based on the underlying principles of honesty, integrity and reputation. The FSA fit and proper persons test covers a wide range of factors including:
- Criminal background checks
- Financial background checks
- Training and qualifications to perform a regulated role
- Previous experience to support employment in a regulated role
- Previous complaints of misconduct in regulated activities
- Directorship or partner of any business that is or has been subject to investigation by a regulator
- Previous employment history and in particular any instances of dismissal or forced resignation
For more information on fit and proper tests for employees visit http://www.employmentscreening.co.uk/fsa-fit-and-proper-persons-test.shtml or call Credit Check Services on 01992 719 234.
