Vendor Screening: What does peace of mind mean to your company?
Vendor Screening significantly lowers your company’s potential liability.
We understand your time is money, and that in today’s fast-paced and economically-challenged business environment it makes sense to cut expenses where you can. But vendor screening is not one area that should be taken off the ledger. And it should be managed by experts who know the industry from the inside out.
Why? Consider this…
Reality bites
- CNN reports that BP and another company hired an unscreened worker who supervised oil spill cleanup workers, raping one of the crew. Only drug screening was carried out in this case, no thorough vendor screening.
- The Baltimore Sun reveals worrying trend: several engineers and architects commit a range of offences including forgery, identity theft, felony theft and practicing without a license. License verification is part of the vendor screening process.
- CNNMoney reports on a major retailer that paid an $11 million settlement because contractors hired illegal aliens to client at 61 stores. This incident shows the trickle-down effect when vendor screening procedures don’t reach far enough down the pipeline.
Startling statistics
- There is a staggering presence of fraud worldwide. The Association of Certified Fraud Examiners reports that a typical organization can lose up to 5% revenue annually and that there are red flags to be on the lookout for. Here, vendor screening can become your watch dog.
- At some large firms indirect labor (temporary staff, contract workers, etc.) can make up to 30% of a company’s workforce. A recent study found that 92% of these employees may have a felony record, with approximately 50% having some kind of misdemeanor record or a history of drug abuse. Amazingly, these figures are based on companies who actively carry out vendor screening and various background checks. Imagine where they’d without these critical measures in place.
These facts provide a stark reminder that due diligence vendor screening is a critical business procedure that needs consistent attention and monitoring with your employees, vendors, contractors, potential partners and investors.
Do You Really Know Who You Are Doing Business With?
As a business owner or principal, it’s your responsibility to protect the interests of your company, from the safety of your people to the financial security of your enterprise. If you don’t take vital steps, simply put, you pay your money and take your chances, a sure set-up for an eventual downfall that may end up costing you thousands if not millions of dollars. Vendor screening can help prevent good business going bad.
Checking a vendor’s credentials, as well as those of its principals, is an essential business practice before providing a vendor access to your business assets, facilities, and workforce. Without vendor screening procedures in place, small mistakes can have big consequences like:
- Wrongful hire law suits.
- Potential for fraud and abuse.
- Financial failure leading to unfulfilled contractual obligations.
- Serious ramifications to your company’s public image.
Let’s face it. No one wants to think a vendor or potential business partner could be unscrupulous, but unfortunately these incidents are becoming more and more prevalent. In today’s economy, companies are downsizing and outsourcing like never before, work opportunities are dwindling and employees are either facing reduced work hours or losing their jobs all together. Businesses are suffering and many are going under.
These unfortunate circumstances make some people desperate to do anything to find work. Others may already have questionable backgrounds and will specifically watch for opportunities with companies where vendor screening is either not done at all or only at certain levels.
These people deliberately look for vendor screening loopholes, so it’s wise to tighten your defenses.
Vendor screening logistics and savings
There is no doubt processing credit applications, background checks and checking licenses takes time, not only initially but over the long-term. That’s why outsourcing this vital service makes both time and money sense. And a reputable vendor screening company with a proven track record fits the bill.
Our vendor screening services take the administrative burden off your employees. We handle everything from set-up, collection and verification of all vendor documents to managing your insurance certificates, and more.
With over 40 combined years in the vendor screening business, you can count on our vendor compliance expertise.
In launching over 120 management companies, our vendor screening experts uncovered numerous vendors with serious financial issues, some unlicensed for the work they were performing, and many with violent criminal and sex offender backgrounds.
Here are some statistics on typical report findings:
- - 11% of vendors have relevant, derogatory information in their file.
- - 31% of professional service providers have had a lapse in auto liability coverage in the past two years.
- - Over 45% of service providers have experienced a lapse in general liability coverage in the past two years.
Without doing your due diligence vendor checks, how would you know who you’re dealing with?
You can be sure we take the safety and security of your business as seriously as you do.
Vendor Screening at its Best
- Our vendor screening experts screen under the Patriot Act, Money Laundering Act, and Executive Order 13224 (OFAC), providing your company with protection from paying fines for non-compliance.
- Background checks are performed on principals of each vendor company, ensuring the safety of your residents, guests, employees, or commercial tenants.
- Mandatory up-to-date licensing and certification is consistently maintained. In fact, our system is enhanced at least twice a month, based on client input and requests and easily integrates with your accounting software such as Yardi and MRI.
- All vendor documents are date and time-stamped to create an audit trail and will be viewable for a minimum of seven years. Virtual vendor screening moves with the 21st century. You can access an archive of all vendor documents and compliance status reports 24/7 through our secure, password-protected web interface.
Who We Work With
As the nation’s largest vendor screening company, we work with a diverse range of clients across numerous industries from small law firms with a few employees up to real estate conglomerates worth $6 billion. No matter the size of an organization, our vendor screening programs are customized and standardized for each individual client.
What We Screen For
Due Diligence Vendor Check
Bankruptcy, Lien, Collections, & Judgment Check
Insurance Verification / Certificate Management
Management of W9 Documents
Better Business Bureau
Professional License Verification
Government Watch List Verification:
Searches include OFAC and Terrorist Watch List and FBI Most Wanted databases
Patriot Act
The Money Laundering Act
Executive Order 13224
Conflicts of Interest Verification
National Criminal & Sex Offender Background Checks
Minority-Owned Business Designation - Diversity Vendor Screening (platform for compliance immigration regulations)
Other Vendor Screening and Compliance Management Services:
Management of Liability Insurance Certificates
- Retrieval, storage and management of your certificates of insurance, e.g., liability and worker’s compensation coverage.
How We Work
1. One of our licensed insurance agents will be assigned as your account manager to assist you and your employees with the vendor screening process.
2. We establish a standardization of your vendor selection by setting up and implementing ongoing vendor screening management procedures based on your requirements and our best practices.
3. In addition to managing your vendor screening, we also assist you with your business rules, advising which rules work and which ones are more difficult to enforce based on vendor type, category and risk levels.
4. Our vendor screening staff communicate directly with your vendors and their insurance agents to ensure they meet compliance regulations.
5. We create a customized certificate management database dedicated to your account. Access is available 24/7. Customized vendor screening reports are also created based on your specific needs and objectives.
6. We provide vendor screening system flexibility, e.g. if a specific insurance requirement is to be waived for a single vendor, we can update our records to indicate this unique arrangement and document this transaction.
7. All vendor screening documents are reviewed by a quality control team.
8. We have a dedicated inbound and outbound vendor screening call center available.
Did you know the majority of your current vendors are already in the Compliance Depot system and are familiar with the vendor screening process? We have over 186,000 vendors currently in our database.
Preventative measures outweigh the risks
When you consider it costs on average, $300 per vendor for your in-house staff to take care of these critical vendor screening tasks, not to mention the thousands or millions of dollars you could face in liability costs as well as a damaged reputation if you don‘t screen your potential vendors and partners, you can see how advantageous it is to add vendor screening to your standard operating procedures.
Put your trust the nation’s largest vendor compliance management company. It will be well worth your while. After all, in business, time is money – and peace of mind is priceless.
Don’t take chances with your business. Call 888.493.6938 to speak with a Compliance Depot sales associate today, and let us manage your vendor due diligence.
