Background checks

Background checks are investigations into the character or history of an individual. They are performed by government and private-sector employers, by purchasers of corporations who are performing due diligence checks on the acquired corporation’s leaders, by insurance companies and other litigants who wish to investigate individuals making claims, by charitable organizations who are seeking volunteers, and sometimes by family members or friends who are suspicious of the individual’s love interest. A number of factors have contributed to a dramatic increase in background checks, including fears of terrorism and workplace violence, liability for employee negligence, risks associated with hiring litigious employees, employee fraud and embezzlement, the possibility of volunteers abusing the elderly or children, and the low cost and high speed with which electronic public records databases can be searched.
Background checks vary greatly in procedure and scope, depending on the purpose for which the check is performed. A background check for a national security position can cost $10,000, involve polygraph testing and an in-depth exploration of the applicant’s associations, and focus on past or current behavior that could subject the applicant to extortion.
Regular employment background checks are much less expensive, ranging from a simple electronic records search that can cost less than $50 to in-depth vetting for corporate executives, which can run into thousands of dollars. Regular employment background checks focus on criminal convictions and arrests, past litigations, a history of insurance or worker’s compensation claims, driving record, credit card and other debt, drug and alcohol use (which may be explored using urine analysis or hair or blood testing), medical problems, and military history. They can involve interviews with neighbors and other associates, and verification of educational status and of prior employment. Because of concerns about employee theft, major employers have created cooperative anti-shoplifting databases that may be queried to see whether an applicant has ever been accused of dishonesty without actually being charged with a crime. In the retail and service sector, background checks often are combined with “personality tests” designed to gauge an individual’s attitudes toward workplace organization, work ethic, and honesty.
In the employment context, background checks are governed by the federal Fair Credit Reporting Act (FCRA) and by state regulations. The FCRA requires employers to obtain consent from the employee before engaging in a background check, specifies procedures to prevent stale and inaccurate information from being provided to the employer, and gives the employee the right to an “adverse action” notice if the check is used to deny employment. The Federal Equal Employment Opportunity Commission bars employers from relying solely on criminal conviction information; the nature of the conviction must be relevant to the job, or there must be some independent, sound business reason for taking action against the individual. State laws impose further restrictions, in some cases including prohibitions on the use of derogatory information more than seven years old or arrest data that did not result in a conviction.
Outside the employment context, investigating the background of another may not be subject to any kind of regulation. For instance, charitable organizations may investigate prospective volunteers to avoid risks of elder or child abuse. Sometimes individuals suspicious of a friend’s or family member’s personal activities will initiate a background check. These unregulated checks can amount to cursory scans of public records databases or more involved inquiries, including illegal “asset searches” performed by investigators who trick banks and other organizations into revealing the subject’s financial status.