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Do You Know Who You're Hiring?

Candidate Background Checking Defeats Resume and Job Application Fraud

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Candidate Background Checking Defeats Resume and Job Application Fraud

Candidate Background Checking Defeats Resume and Job Application Fraud

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Think resume checking and candidate background checking are a poor use of your time? Think again. During times of economic challenge, checking the background and credentials of your potential employee becomes even more important.

Fraud is rampant. Job searchers are desperate. Employers are being duped. Why not find out those less than stellar facts about your favorite candidate before you've come to own him, love him, train him, and integrate him into your company, only to find out later that his credentials are fraudulent?

Your review of employment application materials such as resumes, cover letters, and job applications must assume that a percentage of your applicants are lying about their credentials and job experience. Experts estimate that 20% to over 50% of job applicants lie to embellish their credentials. In fact, Steven D. Levitt, the coauthor of Freakonomics (compare prices), and an economics professor at the University of Chicago, cites research suggesting that more than 50 percent of job applicants lie on their resumes. Cover letters are notorious for embellishment and exaggeration.

With the economic circumstances currently existing and high rates of unemployment, employment application fraud is rising. Employers need to screen employment applications to discern lying, exaggeration, and enlargement of experience, education, and credentials. Fake degrees are on the rise; even bogus job references are prevalent in today’s job market.

Additionally, HR offices report an increase in applications for most jobs. This means that HR offices are weeding through more unqualified applicants and investing time and energy ensuring the accuracy of backgrounds presented on application materials. In addition to fabricating credentials, desperate people will take any job offered even if it’s not the best fit for them or their needs. This includes taking jobs such as part time work, night shifts, and assuming unwanted responsibilities. Of course, their job search continues on the sly.

According to Challenger, Grey & Christmas, Inc. in their @Work blog:

"Statistics on resume fraud are difficult to obtain because only a fraction of resumes are ever checked for discrepancies. The best evidence of resume fraud’s pervasiveness may come from the companies that provide employment screening services.

"In its 2009 Hiring Index, business services provider ADP reported that 46 percent of employment, education and/or credential reference checks conducted in 2008 revealed discrepancies between what the applicant provided and what the source reported. That was up from 41 percent in 2006.

"More than 22 percent of the tech-sector resumes verified in 2007 by New York-based risk consultancy Kroll contained misrepresentations of academic credentials, according to a company spokesperson interviewed by tech-industry publication IEEE Spectrum. The firm estimated that more than half of the tech-industry resumes it reviewed had discrepancies related to employment history.

"IEEE Spectrum also cited a study of erroneous resumes by executive search firm CTPartners, which found that 64 percent of candidates overstate accomplishments, while 71 percent misrepresent the number of years they held a position."

(For additional ideas about places candidates regularly lie or exaggerate, take a look at the whole article.)

Tips for Successful Candidate Background Checking

These are alarming statistics because they come from sources that actually check and save statistics about each area of potential fraud on application materials. Where does that leave the average employer in his or her candidate background checking?

It’s difficult to save time in applicant review in this job searching environment, but these suggestions may save you the grief of hiring a fraudulent employee. The time you spend on the front end will save you all of the time and energy you’ll spend later addressing unqualified employees. These ideas will help.

  • Review resumes, cover letters, and employment applications with a skeptical eye. You can no longer take them at face value – if you ever could. Faked academic credentials are on the rise, too.

  • Ask specific questions about statements made on the resume during the phone screen and during the subsequent interview. Ask questions such as: How did the candidate achieve the stated results? How did the candidate measure to determine that he or she had accomplished the stated improvements? What role did the candidate play on the team that rolled out the marketing strategy? Official title? Unofficial contribution? Careful questioning should reveal differences between stated facts and reality.

    According to Cari Tuna in “How to Spot Resume Fraud” in the Wall Street Journal, “When managers ask candidates about claims on their résumés, they should look for suspicious behavior. Red flags include: Broad, vague answers to specific questions. Other times, job-seekers refuse to say to whom they reported, or who reported to them, citing 'confidentiality.'"

  • Background checking has become critical. Check every fact including degrees, dates of degrees, degree majors, employment history, exact dates of employment, direct supervisors’ names, job titles, job functions, salary history, and why the candidate left each job. If anything seems suspicious, ask the candidate for details and verify the stories the candidate tells you. Ask the candidate for verification.

  • Check the candidate’s history online using Internet search engines such as Google to see if the applicant’s history online differs, in any way, from the “facts” the applicant provided in all application materials. If you find differences, dig deeper, or ask the applicant for an explanation.

  • Look into the candidate’s credit history for any position that deals with money, compensation, and any type of financial information. Indeed, I have received an increasing number of notes from HR people who do not want to hire people who have poor credit ratings, period. They anticipate the increase in staff work related to such issues as wage garnishment, and more, that poor credit will cause in the future.

  • Call references in addition to those that the candidate provides. References he provides are generally positive and will speak well about the candidate. It is unusual to find a reference who says, “No, that does not sound like a job he will do well,” in response to my query (which did happen). Call every recent direct supervisor and ask detailed questions about the candidate’s responsibilities. Cast a wide net to people you know who may know the candidate in her industry and among your contacts. In addition to using email lists to contact colleagues for recruiting purposes, use them to check your candidate’s background.

  • Do perform the same checks on any candidate who has been provided to you by a third party such as a temporary staff provider firm or a recruiter. Even if you have an agreement with the firm about what they will check, recognize that no one will ever care as much as you do about bringing qualified, superior staff people into your firm. I have found cases of fraudulent education, work experience, and several serious criminal histories that included violence, arson and armed robbery, when I have supposedly "double-checked" candidate credentials.

  • Establish a no tolerance policy and track record. If you find the candidate has lied or exaggerated credentials in any way, eliminate the candidacy. If you discover a current employee committed any type of fraud during the hiring process, investigate, and then terminate the person’s employment, if you find the employee was untruthful. Establish a no tolerance policy as an employer and hopefully, your reputation will spread and deter fraudulent behavior from candidates.

  • Do background checks that make sense for your job and your industry. Todd Owens, the General Manager of TalentWise, suggests, “Drug screening is important if your applicants are going to be working with heavy machinery (construction industry) or exposed to prescription drugs (i.e. healthcare industry). If the applicant is going to be driving as part of their job responsibility, checking their driving records is a must.” Additionally, Owens says, “Take advantage of the National Sex Offender registry database; it's quick and easy and will go miles in protecting your company from hiring a known sex offender, especially if your business is associated with children or the elderly."

Do appropriate candidate background checking to spare your company the negative effects of resume and job application fraud. Time spent in prevention, with thorough candidate background checking, will save you time, energy, and heartbreak. Learn the facts about your favorite candidate before you’ve come to own him, love him, train him, and integrate him only to find that he and his credentials are fraudulent.

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