Recruitment fraud revisited

Haydn Simpson

As online brand protection continues to rise in importance for global brand owners, how their brands are used by criminals to defraud third parties is becoming more of a focus. Recruitment fraud is one such threat, and it shows no sign of abating.

Using the search term ‘recruitment fraud’, a quick scan of the first few pages of shows that many global recruiters are alive to this threat, as shown by the multitude of pages on their own sites that describe the threat. There are many instances of construction, energy, FMCG and hotel chain owners publishing public warnings about the threat from fraudsters to their potential employees, and this is to be applauded. 

How big is the challenge of recruitment fraud for brand owners? Putting to one side for the moment the financial and emotional loss experienced by candidates who are defrauded, the threat to the brand owner can be summarized in three different ways:

  1. Loss of candidates: the loss of quality candidates to third parties due to a negative recruitment experience is a key concern for recruiters. It doesn’t stop with the loss of individuals that have been defrauded - bad experiences of recruitment spread through social media extremely fast, and it can be a challenge for brand owners to re-establish their reputation once tarnished.
  2. Increased recruitment costs: the Internet provides an efficient and cost-effective route to market for talent acquisition professionals. If candidates lose trust in a brand’s ability to control their online environment, the brand owner will need to heavily invest in reassuring candidates that the online application route is safe. Additionally, HR departments will face increased costs in dealing with defrauded candidates, who naturally turn to the misrepresented brand owners for help.
  3. Erosion of brand equity: the Internet provides fantastic opportunities, but with this opportunity comes increased risk. Brands can, quite literally, be made or broken on the Internet in a short space of time. The loss of brand equity due to third party activity is traditionally difficult to measure, but NetNames’ clients consistently tell us it is of paramount importance to mitigate this risk.

NetNames’ advice remains the same when brand owners are considering investing in online brand protection: understanding the risks to your brand through analyzing online activity is of key importance in making decisions for action. The prioritization of risk matrices will show you the best course of action to take using your resources. Enlisting the help of a third party with existing processes and expertise is a cost-effective way to show clear ROI for any investment made.