When Should You Run a Bankruptcy Check?

A variety of tools and resources exist for employers to screen prospective employees. Checks of criminal history, education and previous employment are all essential pieces of the puzzle.

But what about a bankruptcy check?

While this type of check may not be routinely included in your standard pre-screening process, there are times when it is a good idea.

Here’s what you need to know about running bankruptcy checks on applicants and current employees.

Does Bankruptcy Show Up On a Background Check?

Though sometimes overlooked, a bankruptcy check should be a vital part of your company’s pre-employment screening.

This is more important than ever because the number of bankruptcy filings in the US have been rising steadily in the last year. A bankruptcy is a financial crisis which brings with it long-term consequences for the applicant. Additionally, digital platforms make it much easier to find and flag bankruptcy information than in the past. For all these reasons, more and more employers now include a bankruptcy check as part of their screening process.

However, bankruptcy does not show up as part of a criminal history or civil court background check. You will have to conduct a separate federal bankruptcy check alongside these traditional types of screening.

What Is a Bankruptcy Check?

Along with a credit check, a bankruptcy check verifies an individual’s or an organization’s financial solvency. These screens are valuable because they give you a picture of how that individual or organization handles their money.

An individual becomes bankrupt when they are legally declared as unable to pay back their debts. Therefore, this is an important point of information to consider if you’re hiring for a position that comes with a high level of responsibility. In some cases, an adverse finding may result in barring the candidate from management positions.

Why Should You Conduct a Bankruptcy Check?

Bankruptcy has the potential for a profound impact on all aspects of an employee’s life. The effect can spiral into their ability to maintain positive relationships with employers and coworkers. In addition, candidates who have already declared bankruptcy have a higher likelihood of doing it again in the future.

It’s a good idea to conduct a bankruptcy check when hiring for a role that involves access to financial information and assets, or for any managerial role. For positions like these, knowledge of a candidate’s financial history is a valuable piece of the overall picture when deciding if they are a good fit for your company.

How Can Veriswift Help?

For a comprehensive background check that meets the needs of your company, you can trust Veriswift.

In addition to checking criminal history, education and previous employment records, we can pull up valuable financial information, empowering you to make the best possible hiring decisions.

With the help of Veriswift, you can feel confident that your assets are protected and your employees are qualified for their roles.

We can customize pre-employment screening based on the needs of your industry and the responsibilities of the position for which you’re hiring.

Reach out to learn how Veriswift can help today.