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Hiring in NY City? What you need to know about The Stop Credit Discrimination in Employment Act

Effective September 3, 2015, it became unlawful to conduct credit checks on nearly all potential and current employees if your business is located in the City of New York and you have more than four people on staff (including owners). As an employer, it is important to know the exceptions to this new limitation in the field of Human Resource Management.

What is actually prohibited?  According to the New York Commission on Human Rights (“NYCHR”), the governing body for this Ordinance, an employer cannot obtain a consumer credit report and use it in the hiring process unless the position falls within a specific list of exceptions.  According to the NYCHR, a consumer credit report refers to a credit score, credit accounts, bankruptcies, judgments, or liens whether obtained from a third party source or from the prospective employee directly.

While the Ordinance is being promoted by the City as the most stringent of its kind in the U.S., it does have its exceptions.   The onus is upon the employer to document the exception used to obtain a credit check.  The exceptions include:

  • Positions in which federal or state law requires credit background reports, such as FINRA licensed companies;
  • Police Officers, peace officers, or positions with a law enforcement or investigative function at the Department of Investigation (“DOI”);
  • Any positon subject to a DOI Background Investigation;
  • Positions requiring bonding under federal, state, or city law or regulation;
  • Positions requiring security clearance under federal or state law;
  • Non-clerical positions having regular access to trade secrets, intelligence information, or national security information;
  • Positions requiring responsibility for funds or assets worth $10,000 or more; and
  • Positions involving digital security systems.

It is important to consult an attorney or HR Specialist when making hiring decisions to determine whether or not you are complying with this, and other local, state and federal laws.  Before you do so, here are few practice points to get you started:

  • Research each position to determine if it fits within one of the exemptions—it may require you to develop a list of what is a trade secret or business intelligence that warrants extra HR security for that position and therefore, based on the assessment reached, exempts that hire from the Ordinance’s limitation;
  • Research your industry online to determine if there are federal or state guidelines that require credit history verifications for your industry;
  • Use Google and LinkedIn and other social media platforms when making your hiring decisions to the extent your state does not ban such research or prevent you from using protected activity found on these sites against the candidate (i.e. cannot use evidence of a person’s gender preference, marital status, age, etc. against them).
  • Create a log to document the exemptions used and the factual basis for each exemption claimed; and

The NYCHR has issued an official Guidance about the application of the Ordinance (see https://www1.nyc.gov/assets/cchr/downloads/pdf/CreditHistory-InterpretiveGuide-LegalGuidance.pdf) and it is expected it will continue to update the public on this topic via its FAQ page (see https://www1.nyc.gov/site/cchr/media/credit-check-law-frequently-asked-questions.page)

Maragell Voted Best Computer Forensics Expert Two Years in Row

Maragell Corporate Investigations was honored for a second year in a row by our peers in the legal community with a New Jersey Law Journal Best of 2014 medal for Best Computer Forensics Expert.  On behalf of our entire staff, thank you to all our law firm clients who voted for us and who, year after year, allow us to help them become the smartest attorneys in the room when it comes to electronic-based evidence.

 

 

 

 

New Jersey About Set to Restrict the Use of Criminal Records in Employment Settings

Despite pressure from business leaders and private detectives, the latest version of the New Jersey Senate Budget and Appropriations Committee’s “Opportunity to Compete Act” [SENATE, No. 2124] continues to impose restrictions upon New Jersey employers when advertising for, and interviewing, prospective employees as it applies to criminal records.

According to the Committee, it determined that “[r]emoving obstacles to employment for people with criminal records provides economic and social opportunities to a large group of people living in New Jersey, increasing the productivity, health and safety of New Jersey communities.” It also asserted “[c]riminal background checks by employers have increased dramatically in recent years, with estimates of 90 percent of large employers in the United States now conducting background checks as part of the hiring process…. and that [b]arriers to employment based on criminal records stand to affect an estimated 65 million adults in the United States with criminal records.”

Concerned by employment advertisements in New Jersey that include language regarding criminal records that either explicitly preclude or strongly dissuade people from applying, the Committee advanced its bill to the entire Senate to tackle these obstacles to employment.

If passed, the bill will preclude an employer (of 15 or more people) from requiring a job applicant to complete any employment application that makes any inquiries regarding the applicant’s criminal record during the “initial employment application” process. It will also preclude the employer from making any oral or written inquiry regarding an applicant’s criminal record during the initial employment application process. The term “initial employment application” means the period from advertisement through completion of initial interview.

If an applicant discloses any information regarding the applicant’s criminal record, by voluntary oral or written disclosure, during the initial employment application process, the employer may make inquiries regarding the applicant’s criminal record during the initial employment application process.

Notwithstanding the foregoing, employers should be aware that if the employment is for a position where a criminal history record background check is required by law, rule or regulation, or where an arrest or conviction by the person for one or more crimes or offenses would or may preclude the person from holding such employment as required by any law, rule or regulation, or where any law, rule, or regulation restricts an employer’s ability to engage in specified business activities based on the criminal records of its employees, the restrictions of the bill do not apply.

This last exception is key for many of our clients. For our non-regulated clients that send employees into regulated entities like banks, hospitals, and mortgage lenders, their contracts routinely contain clauses that require all employees to be screened and failure to produce proof of a background check can void the contract.

Hence, when advertising for a position, consider all job assignments the candidate may be obligated to fulfill. If a potential assignment is in a regulated industry where a background check will be needed, the bill’s restrictions on advertising and interviewing may not apply.

NJ State Bar Association Convention–Congratulations to our Winners

Borgata

NJ State Bar Convention

Maragell recently exhibited at the NJ State Bar Association Annual Meeting and Convention at the Borgata.

500+ guests stopped by to learn more about our computer forensic and investigative services, 160 entered the Treasure Chest prize giveaway for a chance to win a $100 gift certificate to the PI Gear online shopping mall, and 129 entered our fishbowl drawing for a chance to win an iPad mini and a free employee background check.

Congratulations to our winners:

Treasure Chest Prize–PI Gear Gift Certificate: Jonathan of NJ
1st Prize–$150 Background Check Certificate: Stephanie of Woodbridge, NJ
Grand Prize–iPad Mini: Doris of Freehold, NJ

We thank all our guests for taking the time to meet us and look forward to fulfilling their investigative needs.

Philly Inq.: Due Diligence Crucial in Investment Endeavors

fraud-is-everywhere

 

Jeffrey Brenner, Esq., NJLPI, was quoted in the Philadelphia Inquirer Business section on January 8, 2014 regarding J.P. Morgan’s settlement with the government over its dealings with Bernard Madoff.  Brenner, who investigated Madoff’s auditors in 2006, described how basic due diligence techniques revealed major red flags about Madoff’s operations, and how the same techniques can help today’s investors avoid becoming a victim.  Read the article here: http://www.philly.com/philly/business/20140108_Due_diligence_crucial_in_investment_endeavors.html

Maragell Presents on Electronic Evidence at Fraud Training Conference

Maragell Corporate Investigations’ Managing Principal Jeffrey Brenner, Esq., NJLPI, recently gave a presentation titled “You Found My Internet History? Tales from the Hard Drive” at the 21st Annual All-Day Fraud Training Conference hosted by the Philadelphia Area Chapter of the Association of Certified Fraud Examiners.

The presentation focused on six cases in which the early preservation and forensic analysis of electronic evidence changed the outcome of the litigation.

Judge Rosemary Ramsay names Jeffrey Brenner to be court-appointed computer forensic expert

On Friday, December 6, 2013, Superior Court Judge Rosemary Ramsay named Maragell’s Managing Principal, Jeffrey S. Brenner, Esq., NJLPI, as the court’s computer forensic expert in the case of former Parsippany Police Capt. James Carifi.  

According to published news reports, Carifi, who was already engaged in separate litigation with the Township of Parsippany, became the subject of a police internal affairs probe in which the Township claims he “manipulated” data on municipal computers and transferred police documents to his personal email.  These acts allegedly took place in late March, just before Carifi left the police department’s employ.

Rather than argue the motion for emergent relief, the Township and Carifi entered into a consent agreement under which Carifi will turn over his hard drive for preservation and imaging by Maragell.  Carifi will then be allowed to assert any applicable privilege he might have and withhold certain documents but must keep a “privilege log” of those items for review (and possible challenge) by the Township.

Best of 2013

On the heels of our first year anniversary celebration last month, NJLJ Best of 2013Maragell Corporate Investigations was honored by our peers in the legal community with a New Jersey Law Journal Best of 2013 Bronze medal for Best Expert Witness (Computer Forensics). Voting was limited to lawyers and their professional staffs, making this honor especially gratifying.

Maragell, which comes from the Old Testament word for spy, provides a wide range of corporate investigative services, including computer forensics, background checks, due diligence research, expert witness services, and employee theft and internal fraud investigations.

The Maragell team extends its sincere gratitude to all those who voted BEST-OF-2013-LOGO-(regular)for the firm, and we look forward to providing many more years of superior service and expertise.

First Anniversary Attendees Learn How to Use Investigative Databases

HADDONFIELD, NJ – OCTOBER 10, 2013 – Maragell Corporate Investigations celebrated its first year in business on October 10th with a ribbon-cutting ceremony and interactive community open house. The company, which until 2012 operated as the U.S. office of Intelysis Corp., benefited from an upturn in the region’s economy. “We saw a marked increase in investment activity by hedge fund and venture capital clients, which use our services to conduct background checks on prospective portfolio companies,” said Jeffrey Brenner, Esq., NJLPI, the company’s founder. “Our team was also brought into several complex computer forensic investigations, including theft of intellectual property, bankruptcy fraud, and employee violations of restrictive covenants,” he added.

As part of the open house festivities, Maragell’s staff demonstrated several insider investigative techniques. Team members accepted computer hard drives from attendees and demonstrated how data the users thought was permanently deleted could still be retrieved. Then, using the U.S. Department of Defense data destruction standards, they wiped the hard drives, enabling them to be recycled without fear of data loss or identity theft.

Brenner and his team also amazed guests by broadening their understanding of the power of the Internet, showing that many of the same tools used to locate to locate lost friends and loved ones can be used to track down missing persons, debtors, and witnesses. Similar strategies are also used to conduct pre-employment background checks. Maragell’s researchers demonstrated how these checks are conducted and why they are more of an art form than an exercise in data input/output. Combining multiple sources of public information, investigative databases, social media sites, and Google, together with data provided by the subject (in this case one of Maragell’s employees), the demonstration revealed how a PI reads the tea leaves and assimilates the information to create a complete, and accurate, picture of the subject.

Maragell completed the day with a demonstration on how computer forensic experts hunt for evidence of wrongdoing through the use of keyword searches and deleted emails. Of note was the fact that words such as “non-compete” and “breach” which might be expected to return relevant information about an employee’s plans to violate his or her contract, were shown to appear in many forms and locations having nothing to do with the facts of a case. “Poor keyword choices can cost a client thousands of dollars in eDiscovery costs and attorney review time, and we make every effort to avoid this pitfall with highly strategic searching,” said Brenner.

Not a Secret: Investigators to Celebrate 1st Anniversary

Maragell to Celebrate its One Year Anniversary

Thursday, October 10, 2013

Noon to 7:00 p.m.

Maragell, LLC, will celebrate its first year in business on October 10, 2013 with a ribbon cutting ceremony and open house.  Founded by Jeffrey Brenner, Esq., NJLPI, Maragell is located on Mechanic Street in the heart of the historic borough of Haddonfield.  During its inaugural year, Maragell was fueled by an upturn in the region’s economy as its clients increased their use of its investigative services in connection with their hiring and investment practices.  Maragell was also kept busy with several complex computer forensic investigations through its partnerships with several top-tier accounting firms, eDiscovery vendors, and the region’s major law firms.  In addition to the ribbon cutting ceremony sponsored by the Partnership for Haddonfield a number of special activities are scheduled throughout the day, including free investigative tutorials.

Open House Highlights Include:

Noon

Meet and Greet (and Eat!)

1:00 p.m.

Ribbon Cutting Ceremony by the Partnership for Haddonfield

2:00 p.m.

Keyword search demonstration

Learn how to get better search results

3:00 p.m.

Background check demonstration

Conduct a pre-employment screening with us, live

4:00 p.m.

Deleted email recovery demonstration

See where the data resides on your computer

5:00 to 7:00 p.m.

Networking and cocktails

Luncheon and evening Hors d’oeuvres by
Ludovico’s and Marie’s Sandwich Shop

Desserts by
Hollingsworth’s Cookies and Sweet T’s Bake Shop

RSVP by October 7 to celebrate@maragell.com