Bank One Corp., one of several large banking companies now using electronic fingerprints to screen potential employees, said the job now takes two to four hours instead of two to three months.
Bank One began using the technology companywide in April. J.P. Morgan Chase & Co., HSBC Bank USA, and FleetBoston Financial Corp. have set up similar systems within the past year.
Background checks are a necessary component of hiring new employees at financial services firms and companies have done paper and ink fingerprinting of all employees for decades, although that method is required only for those with Securities and Exchange Commission affiliations. Under Federal Deposit Insurance Corp. regulations, banks can be fined as much as $1 million a day for hiring a person with a criminal record or keeping one on the job after learning of it.
In 1998 the New York Clearing House, which now calls itself The Clearing House, began offering its bank owners and customers a real-time connection to the FBI's archive, and Bank One said this was one reason it joined The Clearing House in 1999. The bank makes 18,000 to 20,000 hires a year.
The Chicago company uses a system from Cross Match Technologies Inc. of Palm Beach Gardens, Fla., to record potential employees' finger images and archive them. Then it passes them along to The Clearing House to send them to the FBI.
Now 80% of the background checks are completed and the results reported back to the bank in a few hours, said Lynn Woodard, a vice president and security manager at Bank One. In remote areas the bank uses the local police to complete its background investigations.
"It has been tremendous for us," Ms. Woodard said in an interview in mid-September. The bank has begun conducting background checks on job candidates before they are hired rather than after an offer has been made and accepted.
"Everyone feels very comfortable - human resources, security, and legal," Ms. Woodard said.
The conversion from paper has taken two years, she said. Bank One started evaluating the equipment in 2001 and began a pilot test in November 2002 before taking the system companywide.
"Now that we know we have this capability, it can be implemented into other areas," Ms. Woodard said. She would not specify.
Cross Match, which says it has signed up eight new bank customers in the past six months, hosted a breakfast in New York in mid-September to showcase its technology to financial firms. One speaker, Edward J. Hennessey, the director of general services at The Clearing House, said that nearly all of his company's member banks are either using electronic fingerprinting or considering it. Citigroup Inc. is setting up a system, he said.
Banks that are not part of The Clearing House use the American Bankers Association as a conduit to the FBI. For security reasons the ABA cannot get the results directly from the FBI; they must be mailed to the bank.
Phillip Sandidge, a vice president at Integrated Biometric Technology in Nashville, said even the banks that use the ABA are starting to use electronic fingerprinting and storage, even though part of the background check process still involves paper.
His company, which competes with Cross Match, has also been picking up bank customers, he said. "Those that migrate to an electronic process do so mainly because of time saved," Mr. Sandidge said. "But there are other benefits, like an archived database that can help other human resources functions."
