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June 15 2010

Smoke and Mirror Degrees Could Put Your Firm 's Reputation at Risk

A recent report by Barry Nixon of the and someone Verifle works closely with details the risks to busines bought on by degrees obtained from a Diploma mill.   For those of you that saw the movie Catch Me If You Can that is based on the real life adventures of Frank W. Abagnale Jr., you know that getting a job with fake credentials is real. This becomes very significant in today 's employment marketplace when employers have very specific needs that they are trying to fill and each hire needs to be filled with the right person with the right qualifications. Also in these times of increased competition and an under performing economy something as mundane as not checking the educational credentials of an applicant can have a devastating effect not only on the organization that hires a person, but also the company that gave them the green light on the person 's credentials.

The concept of screening individuals ' criminal records has become an integral part of the hiring process for most organizations. Major studies by the Society for Human Resource Management and Preemployment conducted in the last several years confirms that well over 80% of firms conduct this type of employment record checks. Less prevalent were firms that conduct educational verifications. With fake Diploma mill and accreditation operations proliferating, the need to verify education and credentials has become a necessity.

So what exactly is a diploma mill? It is a business that offers a diploma or degree for completing high school or post-secondary education without requiring appropriate academic achievement and is not accredited by a recognized accrediting institution. A diploma mill is where you can purchase a degree for money without putting any time into studying academically-a short cut to getting an academic credential and the person has not gained the knowledge that academic study produces. A fake degree comes in two types:

  •  A degree that is purchased from a diploma mill that has little or no commensurate academic achievement associated with it that is purchased from an unaccredited institution and
  • Or a degree that is purchased from a legitimate accredited institution, but the purchaser did not attend the institution.
These two fake degrees require different verifications. The fake degree from the unaccredited institution requires verifying that the issuing institution is fake. While this seems straightforward, many diploma mills also operate fake accreditation businesses that will verify that the degree-offering institution is legitimate and also accredited (Accreditation mill).

Background investigation firms have to be sophisticated enough to understand the deceitful web that these companies can weave. For the degree from an accredited legitimate institution that was not earned by the applicant this requires verifying that the person actually attended the institution and obtained the degree or credential claimed. Incidentally, accepting a copy of the person 's degree is dangerous business these days with services now available that replicate degrees at the level that the actual institutions in many cases cannot tell the difference.

One company learned this the hard way when they hired a controller who indicated he had a financial degree and was a Certified Practising Accountant (CPA). After several months, the president of the company noticed several mistakes and many questionable decisions made by the controller. An investigative firm was hired to conduct a background check and found that the individual did not possess a degree. While in this case the company did not experience a significant financial loss, one can only imagine the potential damage that an unqualified controller could inflict on an organization.

Another example involved a nursing assistant who was hired by a convalescent home and subsequently raped a patient. As it turns out, the nursing assistant 's license to practice has been suspended and the company never checked the validity of their credential. In the ensuing lawsuit, the company was ordered to pay $750,000.00 to the victim and went out of business. More and more cases are starting to indicate that background investigation firms are being held culpable for providing inaccurate or incorrect information on applicants.

However, a new trend is going to emerge where background investigation firms will need to set a minimum requirement of records to be checked including educational verifications. To do otherwise will leave the background investigation firm wide open to reputational damage because when the news hits the paper and Internet that the applicant you referred had a fake degree or one from a diploma mill, the fact that the client did not want this service is going to get lost in the small print. People will remember that your firm was the one that referred the candidate who committed some atrocious act, or robbed their client blind, and this will cost you business.

While opinions vary widely about the real threat that organizations face from filling jobs with applicants who have purchased a bogus college degree, the question that you have to ask yourself is what level of risk do I expose my company to by hiring someone who has misrepresented or outright lied about their academic achievements? Will we simply be embarrassed or could it pose real danger and risk?

Consider the following example to help you decide whether there is real risk: A Connecticut woman claimed to be the 2008 Connecticut Nurse 's Association's "Nurse of the Year."" At least one doctor was impressed by this achievement and hired her on the spot. The problem is that there is no Connecticut Nurses Association. Even worse, the woman wasn 't even a nurse, yet she was providing care to the doctor 's patient. The risk to the employer in these examples are very obvious since if something goes wrong the employer is clearly on the hook and looking down the barrel at a negligent hiring lawsuit.

But what about the firm that provided the background investigation, are they too at risk? A recent case illustrates the point: A very well known background screening firm recently gave the green light on an applicant for a client and it turns out the person had a criminal record and did not possess the educational credentials claimed. The client fired the background screening firm and won a lawsuit against them for fifty thousand dollars. Not only was the company sued and forced to pay damages, but they incurred legal costs and their reputation was tarnished. When an organization looking for a background investigation firm starts vetting them, lawsuits of this nature will become known and are likely to dampen the organization 's enthusiasm to do business with them. In the competitive world of background investigations, your competitors will be more than happy to volunteer to a prospect your history of lawsuits and lost business.

Just in case you are thinking to yourself that a fake degree may be an issue, but how big of a problem can it really be-consider that it is estimated there are as many as 3,000 such firms worldwide and more than 800 in the U.S. A recent comprehensive report on fake diploma mills and accreditation operations released by Verifile Limited company, identified the U.S as the world leader in this dubious business practice. The groundbreaking report is the result of an 18-month international research project into diploma and accreditation mills - fake Universities and Colleges. The research was carried out by Verifile 's research team with the support of Cambridge University and the East of England Development Agency. Alan Contreras of Oregon 's Office of Degree Authorization, one of the national leaders aggressively challenging fake universities, calls the Report: ""An excellent job assembling facts about the degree mill problem in the world today. In the murky world of bogus credentials and dubious evaluators, The report provides an example of how research in this field ought to be done."" Another study showed that one diploma mill was issuing 500 fake degrees a month. With the number of diploma mills in operation this is a lot of people with smoke and mirror degrees. Also current research indicates that approximately one out of ten job applicants misrepresent or lie about their educational credentials.

Lies come in many different forms. It could be the person that says they are a CPA, but actually just has a bachelors degree in finance, or the person who just completed one year at a community college, but says they have a degree from Harvard, or the person who says he or she graduated cum laude, but actually was an average student. The real impact of the misrepresentation has to do with the nature of the work that is to be performed by the person and the level of risk goes up.