Question for those experienced in working with recruiters, either for permanent or contract positions.

A recruiter has told me that some (many?) companies have a policy of rejecting any recruiter-provided applicant that has ALSO applied for a full-time position with them recently. Is this a typical situation? I was preparing to apply direct to a few companies, assuming I could also apply to any recruiter postings I later saw for the same company. But this has given me pause.

Previously I figured that a company might pass on you in the flood of resumes they get for permanent positions, but would still consider you for a contract position after a recruiter has vetted you and sent them your profile. I did not even see a reason to mention to a recruiter that I had previously applied direct to the same company unsuccessfully. I do not understand how it would be to a company's advantage to reject a contractor simply because he'd previously applied for permanent there. Though I can certainly see why such a policy would be helpful to RECRUITERS, since it would make potential contractors hesitant to apply directly, if doing so locked them out of any potential contract positions.

Is this an actual, typical hazard out there, or just a recruiter scare tactic?