Ask an Expert
Employee Bonds
Expert: Simone Vermette
Norm asked:
Besides a history of theft and fraud, what else can prevent an employee from being bondable? (ie drunk driving conviction?) (Editor's Note: we contacted Norm for more information and he clarified that they are interested in bonds for financial securities).
Simone Vermette answered:
It depends what field they're in. When we look at a risk to write a fidelity bond we look at the a number of factors including type of industry, internal controls, number of employees, and the number of locations.
In our bonds, automatically, anyone who is a known felon is excluded. So if they have been convicted of a crime such as fraud our bond wording automatically excludes them. However, if the crime was not a felony then we have to look at the type of crime when deciding whether or not the person can be bonded.
A drunk driving conviction does not necessarily mean that they're going to steal money from the company. Prior theft, bankruptcy, a known gambling addiction, or major financial problems may indicate to us that they may steal from the company. These are things that the employer has to look at.
The information is passed onto the broker and then onto us. As far as employees themselves we don't have individual applications submitted to us for bonding. (There used to be something offered called Form B that was Position Bonding.)
Remember that putting up a good frontline defence is your responsibility as the employer when you are interviewing.
About the author
Simone Vermette is a fidelity underwriter for London Guarantee Insurance Company.