Fraud News U.K.

Practical Fraud Prevention via Background Checks and Understanding Fraud Psychology
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By David Rosen, CFE

In this article adapted for the ACFE’s Fraud News UK e-newsletter, I consider the benefits of vetting and employment with a criminal record.

A recent case study showed correct vetting could have identified a convicted fraudster.

An employee had been convicted only a few years before for fraud and dishonesty. The role of being a workhouse manager entailed a high degree of trust and responsibility. That is not to say he could not have been employed. Having a criminal record does not mean you can never get a job, but certain jobs should not be available to people who are convicted of fraud and dishonesty. It is not about discrimination, it is about safeguarding one’s business.

The Rehabilitation of Offenders Act 1974 exists so that after a period of time, if one has not re-offended, you no longer need to disclose your criminal record. That period of time varies with the seriousness of the offence, and the seriousness of that offence and its bearing on your suitability for a particular job. Taking an obvious example, a convicted child sex offender should not be allowed to work around children in any capacity.

What about a vetting procedure generally?

This article is not about considerations or issues of discrimination for any reason. They are of course very important issues, but this is not what this article is about.

Usually, an employer begins consideration of a prospective employee when receiving a curriculum vitae (CV).

Different employers look for different things in a CV. Let us therefore postulate that the job offer is for a professional position, say in law or accountancy.

A sifting process then commences. The obvious points are: presentation, spelling and grammar.

Then, perhaps, academic qualifications and experience.

An employer will then sift through and set aside those CVs which are outstanding, and those which are average, and those which are not up to scratch. Reasons differ. Qualities considered differ. This article is not about what an employer looks for, but rather, what to look out for.

If a CV is outstanding, and the contents are too good to be true, perhaps it is not true…

Compare age to experience claimed.

Look for gaps in work. Ask for explanations in relation to those gaps.

Check age to dates for leaving school, leaving university, leaving professional courses, leaving other jobs and careers. Does it all add up?

Check with colleges, schools, universities as to validity of qualifications, Data Protection Act considerations being taken into account.

Ask for references from those given, but also take the time to make contact with them directly. A letter of reference may not be worth the paper it is written on, sadly. People are so scared of employment laws and negligent misstatement, that standard wording is usually given as to dates and roles of employment, but nothing adverse. This is unhelpful, but understandable to the person given such a statement. Contacting a referee and asking for an unofficial reference is sometimes met with an official voice simply reflecting the wording of the letter of reference. On other occasions, the words ‘don’t touch them with a barge-pole’ make clear that something is amiss.

An employer would prudently then interview a prospective employee, and perhaps set them a question to allow that prospective employee to demonstrate their academic ability and mind-set.

An employer will ask questions as to the contents of a CV.

A credit-check should be considered against the prospective employee, with their permission. Someone in financial trouble should not be avoided, but careful consideration should be made, and additional safeguards made – especially if the job requires financial trust and confidence.

A criminal records check should be made in certain jobs. Perhaps a prospective employee with access to children in their job, or a role requiring a degree of trust and honesty, should be considered for a DBS check (Disclosure and Barring Service), with permission. This is formerly referred to as a CRB check.

…This, however, is not the end of considerations for prospective employees who could potentially offend.

Reasons to offend and commit criminal acts whilst at work: occupational fraud

Donald R. Cressey, the famed criminologist, created The ‘Fraud Triangle’. It consists of three factors, namely: motivation, opportunity, and rationalisation.

Rationalisation: Maintenance of morale is a huge factor in the work-place. Disgruntled, despondent or depressed staff can lead to far greater problems for an employer. In such circumstances, an employee could rationalise that stealing or skimming, or committing acts of fraud, or theft against an employer or its customers, is perfectly acceptable because after all … if they had been paid what they think what they are worth … or if they had been given a promotion … or if they had been treated better, then that employee would not have been thinking in this way at all. Madness, but rationalisation is a major factor and cause of occupational fraud.

The opportunity to commit fraud is also a material factor.  An employer who has in place checks, and safeguarding procedures will minimise the opportunity.

Motivation is the ‘need’ or the desire for more money or more benefit. It could be that someone has a drugs or alcohol problem at its most sinister. It could also be that someone cannot afford bills at home. Motivation need not be for a dark reason.

The Fraud Triangle helps explain why, and how, a person might commit fraud. Through effective background checks and understanding the psychology behind those who commit fraud, we can better remove their opportunity and help prevent future schemes.


Contact the ACFE
For more information, contact the ACFE at or (514) 478-9000.