Benefits October 27, 2006

Employers Find Reasons not to Hire with Internet Search

October 27, 2006 (PLANSPONSOR.com) - A new survey from CareerBuilder.com revealed that more than a quarter (26%) of hiring managers surveyed have used Internet search engines to research job candidates.
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In addition, 12% said they have used social networking sites to screen potential employees, according to a CareerBuilder.com news release. Of those hiring managers that searched the Internet for information on job candidates, 51% said they did not hire the candidate based on what they found. Of those who scoured social networking sites, 63% said what they found led them to pass on a potential employee, the news release said.

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Types of information found that caused hiring managers to decide not to hire a job candidate included:

  • 31% – candidate lied about qualifications,
  • 25% – candidate had poor communication skills,
  • 24% – candidate was linked to criminal behavior,
  • 19% – candidate bad-mouthed their previous company or fellow employee,
  • 19% – candidate posted information about them drinking or using drugs,
  • 15% – candidate shared confidential information from previous employers,
  • 12% – candidate lied about an absence,
  • 11% – candidate posted provocative or inappropriate photographs, and
  • 8% – candidate’s screen name was unprofessional.

Rosemary Haefner, President of Human Resources at CareerBuilder.com, pointed out in the press release that, while some information shared over the Internet can hurt an individual’s hiring chances, other information may help.

According to the hiring managers surveyed, types of information they found on the Internet that helped them decide to hire a job candidate included:

  • 64% – candidate’s background information supported their professional qualifications for the job,
  • 40% – candidate was well-rounded, showed a wide range of interests,
  • 34% – candidate had great communication skills,
  • 31% – candidate’s site conveyed a professional image,
  • 31% – got a good feel for the candidate’s personality, could see a good fit within the company culture,
  • 23% – other people posted great references about the candidate,
  • 23% – candidate was creative, and
  • 19% – candidate received awards and accolades.

The survey, conducted by Harris Interactive, included responses from 1,150 hiring managers within the US.

Administration October 26, 2006

SEC Pries Deeper Into Mutual Fund Kickback Deals

October 26, 2006 (PLANSPONSOR.com) - The Securities and Exchange Commission (SEC) has kicked off an investigation into whether independent contractors paid rebates to mutual-fund companies in an effort to snag contracts for jobs such as producing shareholder reports and prospectuses.
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The Wall Street Journal reports the question in the SEC’s investigation is whether mutual fund companies misused investor money and misled their boards about why they picked certain service providers, namely those that had given them kickbacks, according to people familiar with the probe.

The agency is targeting 27 mutual fund companies that it claims took kickbacks from contractors in exchange for recommending to their funds’ boards that the service providers’ contracts be renewed, according to the WSJ.

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The regulator’s investigation into these fund companies’ practices follows allegations against the fund services unit of BISYS Group Inc. for paying a total of $230 million in kickbacks between July 1999 and June 2004 to snag such contracts from the 27 mutual fund advisers. The claims against BISYS ended in a $21.4 million settlement reached in September (See  SEC Investigation of BISYS Comes to a Close ).

The charges by the SEC against BISYS claimed that the financial services outsourcing firm “agreed with the advisers of certain US mutual funds to use a portion of the fees paid to [BISYS] by the mutual fund to pay for, among other things, expenses related to the marketing and distribution of the fund shares, to make payments to certain advisers, and to pay for certain other expenses.”

Stemming in part from information revealed during the BISYS investigation, the regulator has already issued letters to some of the 27 fund companies requesting they give up details about their dealings with BISYS, sources told the newspaper.

According to the Journal, the roster of companies asked to provide the details are not likely to incriminate any of the larger mutual fund companies, as most of BISYS’ clients include smaller banks.

The complaint from the SEC against BISYS discussed the behavior of one such fund company – “Adviser A” – that allegedly demanded millions of dollars in kickbacks for recommending BISYS’ service contract be renewed, saying, if BISYS refused, it would offer the deal to a competitor.

The WSJ reports the complaint said BISYS did agree to the arrangement with the unnamed adviser, and over a five year period, funds totaling $17.3 million were subtracted from shareholder accounts at the fund company, and were used by “Adviser A” to cover marketing costs, as well as country club initiation fees. In exchange, the agreement said that BISYS would be paid 0.20% of the fund’s assets –  of that amount, BISYS only kept about one quarter.

Some of the money was paid to “Adviser A” above the table, and the rest was paid to the mutual fund adviser through a “marketing budget,” according to the SEC complaint.

News of the SEC’s previous investigation of BISYS sparked an internal investigation in April 2005, and the company has announced it has since terminated all of its agreements with mutual fund advisers (See  BISYS Adopts Reform on Mutual Fund Agreements ).

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