How Recruitment Fraud is affecting the UK Job Market

Recruitment is the basis of building a skilled workforce and is pivotal for business success. However, amidst the pursuit of talent, a shadow of recruitment fraud looms. With studies finding that a typical organisation will lose around 5% of their annual revenue due to fraud. In the UK recruitment fraud poses a significant threat to businesses, job seekers, and the economy at large.  

We have investigated the depths of recruitment fraud in the UK, exploring its forms, impact, and strategies for prevention. 

The Landscape of Recruitment Fraud: 

Recruitment fraud encompasses a range of deceptive practices aimed at exploiting the recruitment process for illicit gains. From falsified credentials to fake job posting, the perpetrator employs various tactics to deceive both employers and job seekers. Not only do these activities undermine the integrity of the recruitment process but also can cause financial and reputational damages.  

Identity Fraud and Falsified Credentials  

Identity fraud is one of the most common of deception enabling individuals to assume the identity of another person and create a fake persona. Fraudsters are using sophisticated digital technology such as AI which is making it harder for hiring managers to weed out these fake profiles during the recruitment process. Some individuals may fabricate or exaggerate their qualification and work experience to secure employment. This type of fraud not only compromises the quality of hires but also exposes the organisation to potential legal liabilities.  

The rise in remote working has in some cases made it more difficult for hiring managers to check and ascertain the identifies of individuals especially if they lack the appropriate tools. Organisations therefore needs to look at their screening procedure and may have to implement identify verification which would allow for a higher degree of confidence that they are hiring a ‘real’ person.  

Combining qualification checks alongside criminal record checks can give your hiring team the most comprehensive background on a candidate. 

Find out more about employment checks here. 

Reference Houses 

There has recently been a rise in what is referred to as ‘reference houses’ which are organisations who provide workers with fake employment, education, and identity to cover up their past in exchange for money.  

Keith Rosser told parliament members in an All-Party Parliamentary Committee meeting in January 2024 that there is growing sophistication of deception in these companies which in unprecedented.  

These companies do not just help people cover up their past to land jobs offers they would not otherwise receive but also support modern slavery and can create opportunities for extortion. This type of fraud relies heavily on modern technology to create non-existent jobs and ai generated imagery.  

You may be interested in our post: The Dos and Don’ts of Reference Checks 

Synthetic Recruiting  

It is not just employers who need to be wary, but job seekers must be on the lookout for fake job postings which can lure unsuspecting job seekers into their trap, with promises of lucrative salaries and attractive benefits.  

During Q3 last year, JobsAware, a service that provides free help to UK victims, reported a 35% year-on-year increase in job scams. From those looking for work, or to switch jobs scammers are cashing in. Often their approach uses fake job adverts to extract personal information and gain access to sensitive data.  

They create a synthetic recruiting experience, from fake job adverts, application process and interviews these frauds have become more convincing than ever before.  

Platforms such as LinkedIn are seeing a major surge in fabricated job ads and profiles having to block 22 million fake accounts between January and June 2023. 

UK companies are warning job seekers to be wary of online recruiters – with their reputations on the line they are keen to combat this prevalent issue. Employers can help reduce this issue by ensuring consistent communication methods and what comms potential employees should expect. 

Prevention Strategies: 

A collaboration between the government, business, recruitment agencies and job seekers to help combat fraud in the recruitment process. Employers should implement robust background screening procedures to verify the credentials and employment history of prospective hires. Job seekers should exercise caution when responding to job ads and be wary of offers that seem too good to be true or ask for an unusual level of personal details. The government should enact stringent regulations as well as help educate to raise awareness of recruitment fraud and how to recognise and report suspicious activity. The adoption of technology such as blockchain and artificial intelligence can enhance the transparency and integrity of the recruitment process making it more resistant to fraudulent activities. From checking identity locations, to using AI to score similarity and help detect plagiarism there are many ways to incorporate your tech into your organisations defence against fraud.  

The ramifications of this type of fraud extend beyond monetary losses, encompassing societal and economic implications. For business falling victim to recruitment fraud can result in compromised productivity, damaged reputations, and legal repercussions. Job seekers on the other hand, face financial hardships, emotional distress, and tarnished career prospects because of falling victim to one of these schemes. Recruitment fraud poses a threat to the integrity of the recruitment process and well-being of businesses and job seekers in the UK. By implementing proactive prevention strategies and fostering collaboration among stakeholders it is posing to mitigate the risks and safeguard the involved parties.