Former Nasdaq employees case is example of why pre-employment screening is so important

Posted by Kristina Taylor
June 22, 2011

Former Nasdaq employees case is example of why pre-employment screening is so important

Donald Johnson is a prime example of why a thorough criminal background screening is needed on all employees —and why the results should be taken seriously.

Johnson, a former Nasdaq executive, recently pleaded guilty to one count of securities fraud for trading on confidential information about companies listed on the Nasdaq. In three years, Johnson acquired more than $755,000 in illegal profits, according to the Securities and Exchange Commission.

But Johnson’s story got even more interesting when it was uncovered that he had a history of fraud and drug abuse. Three years before he was hired at Nasdaq, he’d been discharged from the U.S. Army Reserves for stealing drugs from the Army hospital where he worked as a nurse. He also had admitted to falsifying hospital records in order to steal drugs at another hospital. His nursing license was revoked in 1987, and in 1989 he was hired at Nasdaq.

According to Nasdaq, Johnson underwent a background check and a drug test when he applied there. Though times are different now, people are not. Pre-employment screening services dig into a potential employee’s criminal history and employment history to give employers the full picture on the kind of person they’re considering, and what their past says about then.

Johnson’s story is a word of warning to employers who think employee background checks are unnecessary.

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