Without non-profit organizations, thousands, if not millions, of Americans would go without an array of services. From youth sports groups to domestic violence shelters, and animal rescue agencies to literacy campaigns, our country is a better place because of the services that countless non-profit groups provide us. There are approximately 2 million tax-exempt organizations operating in the US, with more than 13 million employees and 65 million volunteers.

Non-profits, however, are incredibly vulnerable to predators. Here’s three reasons why:

Lack of oversight – Many non-profits don’t know how to establish effective internal controls. Those that do may feel pressure to spend their money on their mission, instead of developing a solid accounting system, pay scale, and hiring process.

Trust – These groups are often based on the goodwill of others and organizers may not expect their staff and/or volunteers to have ulterior motives.

Insufficient training – This is, unfortunately, common among groups who work with vulnerable populations. Staffers and volunteers are often trained well when it comes to their direct duties, but they are not coached in things like child safety education and abuse prevention.

 Protecting our non-profits from predators is mission critical to ensuring these important services continue. One of the best tools that non-profits can use in protecting themselves from fraudsters and other would-be criminals, is to conduct thorough background checks on staffers and volunteers. While many tax-exempt groups already do this, many, surprisingly, do not, and it leaves them vulnerable.

Here what a fraudster might look like:

  • 63% are women
  • On average, men steal twice as much money as women
  • Embezzlement starts at 42 years old, on average
  • The greatest loss was caused by thieves between 40 – 49 years old
  • 11% of all fraud reported in the U.S. occurred in religious and non-profit groups
  • About 15% of employees who commit fraud are multiple offenders.
  • About 85% of employee frauds are crimes of opportunity perpetrated by first-time offenders who believe they can avoid detection.

The toll of fraud is deeply damaging. According to the Association of Certified Fraud Examiners’ 2012 Report to the Nation on Occupational Fraud and Abuse, the median loss suffered by non-profit entities is $100,000. The median loss to for-profits is only $27,000 more.

These are the most common mistakes that non-profits makes in implementing background checks.

Insufficient Reference Checks – How many times have you heard of friends hiring friends? Maybe you were that friend (either of them). Of those times, how strictly were hiring protocols followed? In the case of non-profits, hiring friends or “people you know,” and not following standardized hiring policies is a dangerous situation. The book, “Leadership in Nonprofit Organizations: A Reference Handbook,” says problems first arise when no one follows through on reference checks. This is a non-profit’s first line of defense and is, aside from the time it takes to make the calls, the least expensive way to eliminate someone, even if you know them. Performing standardized hiring procedures on EVERY candidate also helps keep a non-profit in compliance with federal hiring and discrimination laws. Just one of those lawsuits could cut a huge chunk out of a non-profits operating budget and affect its ability to perform its mission.

Using Social Media – Google. Facebook. Twitter. SnapChat. LinkedIn. Instagram. The list of social media sites where you cull info about a candidate is nearly endless. Other data services are equally tantalizing and user-friendly. Considering the cost-effective nature of these entities (FREE!), it’s nearly impossible for non-profits to turn a blind eye to them. What many non-profits don’t know is that it’s illegal to solely use social media screening for official organization and hiring purposes.

Every policy needs to incorporate social media into its information gathering. We know a lot of non-profits knowingly peruse applicants’ social media profiles but they may also unknowingly use the information they find to discriminate against protected classes. This downloadable document from The Chartered Institute of Professional Development is a great place to start.

The Cheaper the Better – Non-profits have a bold task. They need to be good stewards of their money, which often leads to questionable behaviors. They want to devote the majority of their money to their mission but this leaves little cash to spend on other top priorities like quality staffing and hiring procedures.

This may tempt you to accept the lowest bid by the screening firm who promises you “instant results.” Know this: There is no single database of criminal information available, and instant checks do not exist. Due to the careful nature of background checks and the laws regulating the collection of a person’s private information, it’s important to know that most reliable background screening providers will turn results for you in two to three days.

Prices for background checks may vary between about $20 to $100. The price of a background check is not always indicative of the quality of the report you’ll receive though. More expensive reports may not encompass all the info you need, and vice versa. The best thing a non-profit can do is find a Consumer Reporting Agency (CRA) like us who is accredited by the National Association of Professional Background Screeners (NAPBS) and consult with a team member who can listen to your needs and develop a package tailor-made for your organization. You’ll also want to learn about their technology standards, research practices, storing capacities and adherence to the Fair Credit Reporting Act (FCRA).


We’d love to hear from some non-profits out there who are struggling with the background check process. What questions do you have? What concerns? We’ll do our best to find out the answers. Leave a comment below!

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