‘Fit & Proper’? It can be hard to know

Pre-employment screening is not only merely strongly advised in today’s world, it is also a regulatory requirement for all financial institutions. In order to preserve and bolster the integrity of the financial services industry, the FSA has provided guidance on what it considers adequate levels of vetting for approved persons and by extension all others entering the industry in a permanent, temporary or contracting capacity. The need for vigilance is supported by evidence, the FSA says, to suggest that organised crime groups deliberately target firms, placing associates to commit frauds and especially identity theft. Alexandra Kelly of Powerchex examines firm’s obligations when recruiting staff and the thorny question of references .

Alexandra Kelly may be contacted on tel: +44 (0) 207 709 2056; email akelly@powerchex.co.uk

“A recent survey of 1500 UK employers found that 71% had encountered lies on CVs and 49% said it was a serious problem when recruiting staff.” ( The Guardian , March 2004). Similar research conducted by Powerchex in July 2006 found that in financial services, the percentage of employees lying on their CV is substantially lower, but still significant at 25%. Clearly, the industry’s pre-employment screening requirement has resulted in a lower incidence of discrepancies and fraudulent background information.