With an increase in negligent hiring, retention, and defamation lawsuits, spiraling recruitment and training costs, and an upsurge in workplace violence and theft, employers feel they need to know as much as possible about every employee. Add that surveys report 30 percent to 50 percent of job applicants either lie or exaggerate on applications and during interviews, and the need to investigate and confirm application data is more important than ever. However, in an effort to appropriately balance an employer's “need to know” with an employee's privacy and equal employment opportunity rights, many federal and state laws regulate the type and amount of information that employers may obtain. Therefore, employers that are interested in conducting background investigations must be fully aware of each law's specific requirements and must tailor their employment practices accordingly or else risk the financial sting of stiff penalties.