RECRUITMENT COMPANIES BEWARE - CONTRACTOR RECRUITMENT FRAUD!

RECRUITMENT COMPANIES BEWARE - CONTRACTOR RECRUITMENT FRAUD!

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This may sound a bit complex to people outside of the temporary work sector, but contractor recruitment fraud is scam that has been going on for a long time.

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It tends to rear its head in buoyant markets and over the past couple of weeks Navartis as a business and me personally have been targeted!

I wanted to put a post out about the effort they made along with things to look out for so your business doesn’t fall foul to this type of fraud.

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Navartis offer a competitive payroll solution so receiving requests out of the blue for the service is not unusual, especially after speaking to a contractor that had used this service albeit a long time ago (who put us in touch with this business)

We have also been sending out marketing emails and had a bite from a company that we haven’t worked with before.

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The company overview:

-?????? This company are a UK arm of a bigger business based in China (also not unusual we work with companies worldwide)

-?????? they have very good credit, turnover is ￡188m and we had a large enough credit limit to place with them.

-?????? They had stable financial accounts over a 5-year period, growing year over year.

-?????? Within the Power sector which is one of our key sectors

-?????? Physical head office based in London

The approach:

-?????? We were emailed by the Head of Finance about the potential of initially payrolling 2 LTD company workers that are already working for them then if that works out there was an opportunity for a 10-20 more.

-?????? He outlined on the phone to me and a colleague why he would want to do this (to streamline the payment process for the workers they have, this makes sense as they would be paying 1 company then we would distribute that money to the relevant companies)

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Green Flags:

-?????? This person had company email signature with logo, head office number and his domain was for the company also.

-?????? They sent us assignment details of the candidates, LTD company information, passport photos, phone numbers, NI numbers, insurances, CVs and the IR35 assessments that had been done for the roles.

-?????? We even agreed to be on 7 day payment terms for the first two and then we would be able to negotiate for the others based on credit.

-?????? Everything was checking out but we still needed some confirmation of a couple of bits before progressing it.

-?????? He knew A LOT! about the business (turnover, company reg number, accounts statements, head office address, staff numbers, directors names)

Red Flags (that were found during the process)

-?????? Head office number after some investigation went through to his mobile number

-?????? The LTD companies that had been sent through had a change in directorship a couple of times

-?????? From the CV properties they had been created 1 day after the phone call and not by the candidates name

-?????? This person wasn’t on LinkedIn and neither were the LTD company workers

-?????? We requested a teams meeting with the client and he changed the subject a couple of times

-?????? Request for the accounts information that would be sending the money was put off “after a meeting with the director”

-?????? Literally no negotiation on payment terms or payroll fees

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After a wasted weeks’ worth of correspondence we managed to find the Director of the UK arm of the business and messaged him on LinkedIn who confirmed that this person WAS NOT an employee of the business and we need to report it.

This may seem obvious when writing but I have had a couple of legitimate payrolls in the past via the same method, so it wasn’t completely mad.

This guy had an email address with the company name in it and came across extremely well over the phone, along with the LTD company contractors.

we have passport photos, driving licenses and LOTS of personal information of the candidates that are obviously in on the whole thing)

Practical steps for agencies (https://www.contractoruk.com/news/0015884contractor_recruitment_fraud_old_scam_still_producing_new_victims.html)

Contractor?recruitment agencies?can take steps to protect themselves from contractor recruitment fraud.

These primarily internet-enabled steps may include:

-?????? Conducting online credit checks on suppliers / contractors and strictly adhering to the credit limits imposed on them.

-?????? Acknowledging that if a company has lots (more than 200) credit enquiries against their name in one month, it’s a red flag.

-?????? Spotting high value timesheets – fraudulent contractors will often attempt to claim as many hours as they can.

-?????? Enforce a checking process on suppliers / contractors which includes checking their company is registered on Companies House.

-?????? Using the Companies House website to identify companies that are filing ‘Micro Accounts’ as this could be a red flag.

-?????? Looking out online for recent changes to website domain names – another potentially red flag.

How to check contractors are who they say they are:

Contractor recruitment agencies can check the details of the contractor.

As a minimum check the:

-?????? Contractor’s identity documents – ensure they are genuine.

-?????? Physical location – look into the addresses they have provided.

-?????? Bank details – check whether the bank details match those of the contractor / supplier.

-?????? Landline numbers – these are harder than a mobile phone number to hide behind so ask all suppliers to provide a landline.

-?????? Company email addresses – check that these are from the correct company (impersonators may use an email address that is very similar to a legitimate company)

-?????? In addition, consider using a digital verification platform to cross-check these details and reduce the risk of falling victim

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All of these checks and more were done during this process and the nail in coffin was getting confirmation of the bank details that would be sending money to us were that of “the business in question”

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“if its too good to be true it usually is”

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