More organisations across the globe are aggressively looking to set up shop in India. India is rapidly evolving into a vibrant centre for commerce, presenting a wealth of expansion possibilities for enterprises. With the rise of multinational corporations, start-ups, Indian companies’ expansion and GCCs in India, a thriving ecosystem, and substantial investor interest - the Indian economy is showing no signs of slowing down. India has demonstrated its strength of being one of the largest exporters of IT and BPO services globally. Not only Tier 1 cities, but job creations will see a rapid increase in Tier 2 and Tier 3 cities as well.

Companies aspire to integrate the Indian workforce and business practices with global markets, enhancing cross-cultural exchanges and international business acumen. Lucrative policies and trade agreements are further adding to India's economic potential. However, while India’s rapid economic growth presents vast opportunities for organisations, it also brings challenges. Businesses must navigate a complex landscape that can impact their integrity and workforce stability, potentially affecting reliability and overall performance.

And comes also a multiplicity of hiring challenges. Seldom discussed but always a risk is background fraud. With more younger workforce availability in India, the competition amongst the workforce and over-zealousness to get into large organisations, may drive the potential candidates to misstate their employment and education credentials to get employment in reputed organisations. 

What background fraud risks do employers face?

With markets on the upward tick, a myriad of job opportunities have opened but remote hiring in the hybrid workplace presents continuous challenges and there is a gap between companies’ hiring requirements and qualifying candidates.

Candidates are not shying away from obtaining fake employment certificates from paid agencies, manipulating their resumes, forging experience certificates, details on Form 16, hidden employments, obtaining certificates from unrecognised institutes, etc. There is even the increase in usage of deepfake technology to impersonate job candidates in remote interviews.

The trends seen by us remain a concern. As per ACFE 2024 Report, the most common methods used by perpetrators in concealing fraud is creating fraudulent physical documents (41% of cases), altering physical documents (37% of cases), creating fraudulent electronic documents (31% of cases) and altering fraudulent electronic documents (28% of cases). These results indicate that even as many transactions have moved to digital formats, physical evidence is still an important part of fraud prevention, detection, and investigation.

Given the rising incidences of employment fraud and the tech-forward ways devised by fraudsters, it becomes imperative for companies to keep a stringent check over the entire employee lifecycle—right from hiring to annual performance reviews, exit interviews, and workplace behaviour. 

How to weed out bad apples at a pre-offer stage?

While each company is coming up with its own set of rules to regulate employee conduct and drafting specifically defined hiring protocols, companies need to ensure regular monitoring to ensure compliance. Technology-enabled employee background checks are not only helping organisations in their fight against employment fraud, but also helping them determine if the prospective candidate is the right fit for the organisation. 

Many companies have started using tech-enabled document authenticator tool as a pre-cursor to the background verification process. Through this technology, the counts of candidates submitting manipulated documents are identified at a pre-offer stage thus reducing cost and effort of the company to carry out extensive background verification process.

Traditional employee background check methods are less effective to address the concerns posed by fraudsters who are leveraging cutting-edge technologies such as Artificial Intelligence, voice modulation, deep fakes, and high-end document forgery softwares to con unassuming organisations that are on the lookout for experienced and talented professionals. Tech-led employee background checks cut out the biases that human-operated processes are prone to. This helps companies assess the candidate on their merit and make an informed decision that is in alignment with their company’s ethos. The automated solution also presents insights at a glance, making it easier to access pertinent data as needed. 

One of the major challenges of traditional background checks was the time it took for the numerous verifications to be completed, often delaying the onboarding process considerably and leading to tangible losses resulting from an unfilled position. Tech-forward verification solutions reduce the turnaround time considerably, enabling swifter hiring and monitoring. With limited manual intervention, tech verification solutions are more accurate and can be customised basis the law of the land and the specific requirements of the company and provide expedited results. 

In the gig economy, moonlighting has also emerged as one of the major concerns for companies that not only suffer from the employee’s compromised performance due to the dual employment, but also risk data siphoning as a result. Employee monitoring can flag off discrepancies in an existing employee’s records, to help nip the issue in the bud. 

The road ahead

As India continues to evolve as a key business hub, the demand for reliable and trustworthy employees will only increase. Employers must proactively address potential risks through robust background screening practices that align with legal requirements and ethical standards. By investing in thorough vetting processes, businesses can protect themselves from potential liabilities and contribute to a trustworthy business environment. 

Artificial intelligence and automation are significantly reducing turnaround times and reducing costs. Automated data validation ensures that candidate information is checked against multiple databases in real-time, eliminating human errors and improving accuracy. Furthermore, real-time background checks through API integrations will enable instant verification, enhancing hiring agility for companies worldwide. These modern methods of performing digital verifications will facilitate faster deployment of candidates thus enhancing the experience and productivity of both applicants and the companies.

Ultimately, companies will foster long-term success and sustainability by leveraging advanced tech-enabled employee background checks to brace against employment fraud, organisational fraud, behavioural issues, and non-compliance with code of conduct.