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Know who you hire

November 24, 2010
Dealerships a fertile ground for commission of identity theft

For those who feel violated when someone takes that last slice of cheesecake they were saving, imagine the horror of having one's very identity stolen. Identity theft-use of the victim's personal information to charge expenses to her account, open entire new credit lines under her name or other fraud-can create a time-consuming financial and logistical hassle. Unfortunately, a dealership is a ripe environment for identity theft to occur.

Buying a vehicle is a major transaction. As such, the customer is obligated to surrender his name, Social Security number, credit card numbers and more. For thieves, that's a treasure trove. And crime occurs when dealers don't know the people working for them. One dealer in north suburban Chicago said he discovered last autumn that a salesman committed identity theft against one of the store's customers. The employee was fired, but he surfaced a few months later at a nearby dealership and soon committed the offense again.

Gurnee Police Officer Jim McDermitt investigated the crimes. "He had copies of sales receipts with Social Security numbers, driver's license numbers, home addresses, birthdays and more. Why does a salesperson need that?" With exposure to such delicate information, salespeople should be screened before they are hired, McDermitt said. The matter is complicated by the position's high turnover rates. Terrence Creamer, an attorney with Franczek Sullivan, the CATA's labor relations counsel, said employers can use the Fair Credit Reporting Act to obtain credit reports on applicants, as a way of gauging their virtues.

Credit reports investigate and evaluate credit capacity and credit worthiness, but they also measure the character and general reputation of consumers. Reporting agencies can identify public records of arrests, indictments, convictions, suits, tax liens and outstanding judgments. Under the Fair Credit Reporting Act, employers have obligations if credit reports will be obtained on job applicants. The employer must notify applicants in writing that a credit report will be used as part of the application process.

Applicants must consent in writing for an employer to obtain a credit report. If an employer denies employment based on any information in a consumer report, the employer must advise the applicant of that fact and where the credit report was obtained. The applicant must be notified of his right to obtain a free copy of the report and that he has the right to dispute the accuracy or completeness of any information in the report.

Employers must be uniform in their treatment of applicants, Creamer said. "If you let someone go or fail to hire an applicant because of a poor credit rating, but you hired others with a similar report, then you've got a potential discrimination problem," he said.