2007 Petrochemical Security Summit South Shore Harbor Resort & Conference Center R. Ronald Sokol, C.S.P. Executive Director Contractors Safety Council

2007 Petrochemical Security SummitSouth Shore Harbor Resort & Conference Center

R. Ronald Sokol, C.S.P.Executive Director

Contractors Safety Council of Texas City

Update on Safety Council Security Consortium (SCSC) Activities

Brief overview of SCSC and the components of the contractor background screening program

Review current performance of contractor background screening program

Introduce the Integrated Contractor Management System (ICMS)

Presentation Topics

Safety Council Security Consortium

• Who are we and when did we begin?

• What is our purpose?

• What programs do we administer?

• What effect have we had on the contractor background screening process?

• What benefits do we provide to industry?

Who are we and when did we begin?

– Organized August 2005

– Informal structure

– Meet on an as-needed basis

– 14 Members integrated with Vendor Services provided by First Advantage• Major Markets Served: Beaumont, Baytown, Texas

City, Brazosport, Lake Charles, Houston, Mobile, New Orleans, East Texas, Texas Panhandle, Austin, Shreveport, Chicago, Charleston, WV, Tennessee Valley

• Purpose: Establish reciprocal industry standards for consistent, systemic, contractor screening and identity verification process

• Mission Statement: Provide the highest level of security for councils, owners and contractors by adhering to a reciprocal, quality background screen process

What is our purpose?

• Goals/Objectives: Develop contractor background screening solution to meet the following Petrochemical Industry objectives:

Create Reciprocal Solution Create Cost Savings for Industry Reduce Time to Hire Deliver Quality Product Compliance with FCRA Owner Auditing Capability

• Establish Vendor requirements

What is our purpose?

Vendor Requirements

Include:– Control over adverse action– Adhere to all FCRA regulation including site

inspection requirement– ISO 9000 certified– Procedure to purge data– Verification and confirmation of accurate

records through an audit process– Mandatory audit/review of agents and results– Separation of data gathering and grading

process

Cost of Noncompliance

• Cost of noncompliance is high

• Federal Trade Commission (FTC) fines– Choice Point fined $15M Jan. 2006– Lawsuits due to failure to protect personal

information/data

Level 1 – Social Security Verification (SSV) Program which links a government issued photo identification to the consumers social security number

Level II – Background Screening Program– Background Check Graded (BCG) provides a

numeric score based upon the consumers criminal history over the most recent 7 year period

What programs do we administer?

2002: Concept Planning with Southeast Texas Plant

Managers Forum (SETPMF) Basic Package Program approved Pilot Program launched

2003: Proof of Concept validated Social Security Verification (SSV) Program OwnerPass introduced

2005: Background Check Graded Safety Council Security Consortium (SCSC) formed

Brief History of Background Screening Programs:

• Identity Verification • Authorization granted by consumer to SCSC

members• Social Security Verification Process (SSV)

• Purpose: match government issued photo identification to Social Security number for identity verification. Reports are returned in the following status:

Approved – Name and SSN Match Rejected – No Record Found Provisional – No Match, Deceased, SSN Invalid Error – Number outside of Social Security

Administration (SSA) Matrix

Level I Security Assessment

• ~350,000 SSV conducted-no expiration on SSV• Rejected/Provisional status account for

approximately 12% of searches• Failure rates currently less than 1%• Safety Council is considered the end user in this

process and handles FCRA compliance issues• SSV is reciprocal with SCSC members• Best Practice in certain areas ties SSV to SSA,

local Law Enforcement, F.B.I., District Attorney

Results of SSV program

Provisional

12,685 Rejected

2,114Review

27,133

Approved

310,434

SSN SEARCH STATISTICS

(.6%)

(7.7%)

(88.1%)

(3.6%)

352,366 Total

NOTICE!

Possession of Fraudulent State or Federal Documents I, _______________________, understand that under Texas Penal Code Sec. 37.10 (a) (4); it is unlawful to possess, sell or offer to sell a government record or record form with the intent to use unlawfully. I hereby swear and affirm by my signature and under penalty of perjury that the information I provided for identification, specifically my name, Social Security Number and Drivers License or State ID Number are true and correct. Signature: _________________________ Date: ________________

• Offense is a Felony with punishment of up to 10 years in prison and a $10,000 fine

Signage from CSCTC

Safety Council: Background Check Graded (BCG)

• Contractor screening package Prior Background Check

• Database of contractor background screens

OwnerPASS• Plant Owner access to contractor

background screens

Level II Background Screening Program

Safety Council (Website): Ordering and order status portal Client relationship with Contractor

Packages and Reports Available:1. Background Check Graded (BCG)2. Prior Background Check Report3. A La Carte Search Reports (sample)

Federal Search Prior Employer Verification Motor Vehicle Report, etc.

Background Check Searches

1) Background Check Graded – Components::

– Social Security Verification

– County Criminal Searches

– Motor Vehicle Report

– Patriot Act Search

– Graded Package Result Report

Background Check Graded:

Social Security ReportProcessed through Experian Inquiry Does Not Adversely Affect Credit Rating

County Criminal ReportCriminal search performed in jurisdiction of current

residencyConvictions, Pending, Outstanding Warrants &

Deferred AdjudicationFelony and Misdemeanors where available in

highest courtMotor Vehicle Report

Processed by State where Consumer is Licensed


Patriot Act Search Database Search of Office of Foreign

Assets ControlDesignated NationalsTerroristsDrug TraffickersBlocked Persons


Grade: Charge/Conviction Type:00 – Clear record01 – “non-violent” misdemeanors (not on list)02 – “violent” misdemeanors (included on list)03 – “lesser” felonies (not on graded list)04 – felonies in “03” and misdemeanors in

“02” 05 – “higher” felonies (included on list)06 – felonies in “05” and misdemeanors in

“02”07 – Patriot Act “hits”

Program Components:

GRADED PKG RESULT OWNER A OWNER B OWNER C

NO CONVICTIONS = 00 00 00 00

MISDEMEANORS (NOT ON LIST) = 01

01 01 01

LISTED MISDEMEANORS = 02 02 02 02

FELONIES (NOT ON LIST) = 03 03 03 03

FELONIES (NOT ON LIST) AND

LISTED MISDEMEANORS = 04

04 04 04

LISTED FELONIES = 05 05 05 05

LISTED FELONIES AND

LISTED MISDEMEANORS = 06

06 06 06

PATRIOT ACT SEARCH HIT = 07 07 07 07

Grading Scenario

Graded Package Result

GRADED PACKAGE RESULTS

Graded Package Results

78%

0%5%

1%

0%1%4%

0%

11%

Grade:

"00"

"01"

"02"

"03"

"04"

"05"

"06"

"07"

GRADED PACKAGE RESULTS

Graded Package Results:

Timeframe:Total Number of Individuals:Percentage of Hits: % of hits

Grade:"00" 103,280 77.18%"01" 14445 10.80%"02" 5620 4.20%"03" 1413 1.06%"04" 217 0.16%"05" 7077 5.29%"06" 1759 1.31%"07" 0 0.00%

Cumulative133,811

Year To Date

COUNTY CRIMINALAVERAGE TURN AROUND TIME

Overall

0.00

0.50

1.00

1.50

2.00

2.50

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Month

Ov

era

l T

AT

Blue = 2006

Pink = 2007

2) Prior Background Check:

Tool for Contractor Reciprocity and Owner

ReviewReport Available Within SecondsEliminates redundant screensCreates cost savingsAvailable to Contractors & Owners

FCRA letter of notification sent to consumer

Prior Background Check

Prior Background Check Sample


Name : MARK PRIOR

SSN : xxx-xx-1111

Date Created

: 7/1/2005

I f providing this report to consumer per FCRA regulation 15 USC. Section 1681b (b)(3), you must attach FTC Summary of Rights with this report. The information herein was based on one or more consumer reports that were previously ordered . The information has not been updated since such report was originally completed. A verification of this information must be made before you make any decisions. Note: this is a special report and may contain convictions beyond 7 years old.

Applicant Statement None Package Grades - The following records were found in the First Advantage WorkPort Files from 7/1/2003 to 7/1/2005.

Grade Date Grade

04/28/2005 00

Package Grades

When to Order: Council Notification

When Ordering the Background Check Graded

Review of Council’s Training History Applicant/Employee Badge


3) Ala Carte Searches SSN Verification County Criminal Search State Criminal Search Federal Criminal Search Prohibited Party Search Prior Employer Education Verification MVR and others upon request

Ala Carte Searches

Phase 1 Prior to Ordering Searches

Provide Disclosure to Consumer Obtain Authorization from Consumer Keep Authorization on File for Five

Years

Fair Credit Reporting Act Compliance

Phase 2 Pre-Adverse Action Process

Provide Copy of Report to Consumer and Provide Summary of Rights to Consumer Allow Reasonable Amount of Time for

Consumer to Dispute Information Adverse Action Process

Provide Notice of Adverse Action to Consumer

Fair Credit Reporting Act Compliance

Set Up Process: Customize Letters or Use Vendor’s

Standard Letters (Pre-Adverse & Adverse Action)

Name and Title of Person Signing Letters Letters can be customized to use your

Company Logo Web Users allowed Access to FCRA

Web List

FCRA Web Module

What is the effect of the contractor background screening process?

– Over 215,945 Workers Background screened– Over 141,510 Background Checks graded– Over 3,300 Contractor companies enrolled in

process– Over 75 Plant Owners participating in

process– Program is growing in new market areas and

additional owners are participating in existing market areas

Reciprocity Example: Previous Model:

1 worker x 4 employers per year $60 screening event per employer ($60 x 4) $240 per worker per year x 100,000 workers $24 million in screening costs

Current Safety Council Model: 1 worker x 4 employers per year $60 first time screening event ($12 x 3 additional) $96 per worker per year x 100,000 workers $9.6 million in screening costs

What is the effect of the contractor background screening process?

Cost Savings to Industry:

Year 1: $14.4 million!($24 M - $9.6M = $14.4M)

Year 2: $33.6 million!($48M - $14.4M = $33.6M)

Reciprocity for Contractor Background Screening

Identity Verification Services

Background Screening services by qualified vendor

FCRA Compliance

Reciprocity

Cost Savings

More secure workplace

Development of new products (i.e. Integrated Contractor Management System)

What benefits do we provide to industry?

ICMS: Benefits for Safety Council

– Consolidated data source on trainees – Streamlines reciprocity “look-up” process – Effective solution to more positively ID

students and assure demographic credentials are associated with an authenticated individual/trainee

ICMS: Benefits for Contractors

– Consolidated data source for current and future workforce

– Convenient, web-based data source to qualify and assess “ready to work” workers

– Effective tool to manage contract worker compliance requirements for owner sites

ICMS: Benefits for Owners– Consolidated resource to monitor

training, security, fit-for-duty worker compliance at corporate and plant level

– Effective tool to manage contractor company compliance (PQF, certifications, etc.)

– Flexible solution that allows for customized Owner requirements, at corporate and/or plant level

– Allows for data links with additional “qualified” 3rd party providers