Is Background Verification Really Required?

Background verification

Welcome to the second blog in our series. Over the coming weeks, we will talk about the resume/employment verification industry as a whole, provide an analysis and discuss about the difficulties everyone in the ecosystem faces.

We will showcase how upcoming technologies can solve multiple issues the industry faces and how we can make lives better by reducing manual work while instilling trust across the ecosystem.

If you haven’t already, you should read our first blog in this series, that talks about whether it is time to move on from traditional resume verification processes (hint: yes, it is!).


Hiring a new candidate is a tricky process. As the market becomes more and more competitive, it is all the more essential to find quality employees with a high level of expertise in your industry. But at the same time, it is difficult to accept someone at face value — after all, there is a saying “Don’t judge a book by its cover”.

What can go wrong?

‘Red Foods Ltd.’, a food company, hired a new accountant to help with managing the accounts of the company since it had recently expanded to three more locations. They had discovered him through an online networking platform, and were impressed with his profile.

All was going well until the time came to file taxes — the new accountant misrepresented the profits that the company had made, in order to embezzle some. The owners were fined and given a warning. On top of that, the new hire had to be terminated, and more money spent on hiring a new accountant. This led to unnecessary losses for the company.

On further inspection, it was discovered that the accountant had actually done the same thing in his previous job, and was fired for the same thing! He had hidden the fact that he was fired, and misrepresented facts related to his previous position. Had a background check been done, these would have come to light.

To be effective in your hiring, it is essential to delve into the background of the candidate, to uncover any information that the candidate may have hidden or misrepresented, in order to make the most informed hiring decision.

A person’s persona may not be what is seems to be online.

Platforms like LinkedIn enable you to build a professional digital network online. However, there is no background check to the information that is uploaded on the network. The same applies for networks like Facebook and Twitter as well.

It is very possible that the persona that a person has built online may not be 100% representative of that person’s true background. It is very easy to ‘craft’ a persona online, with no way to easily verify whether the information that is being posted is genuine or fabricated.

Why is background verification required?

While most employers don’t assume that candidates will lie in their profiles, background verification is a necessary final step to make sure that the employer is getting what they think they are getting; to save them from any future complications.

1: Background verification gives you a full picture of the candidate.

It is quite possible that the candidate has put on a façade on their resume — they might have added information that is fabricated, or may have removed other information that they don’t want the employer to see.

This may (read: will) put a strain on the hiring manager’s ability to make an informed decision while in the process of hiring a candidate. It is of utmost importance to know every relevant thing about a candidate before choosing to hire them or not.

2: Background verification allows the employer to fulfil their due diligence.

Has the new driver you hired always had a clean driving record?

This is especially important in job positions involving sensitive information or persons, for example an accountant or teacher. If an incident occurs, and it is discovered that the person has a history involving related incidents, then the company can get into trouble for hiring an individual with such a history.

If background verification is done, the entire history of an individual is known before a hiring decision is made. And this is part of the due diligence that is a must for a company to do before hiring anyone for sensitive positions.

3: Background verification can bring up any past incidents that may hamper their ability to perform their job.

It is essential to know whether a candidate has had any criminal history. Sometimes, these can posit someone as being unsuitable for hiring, particularly in certain sensitive job positions. No employer wants someone with a DUI to be hired for a driver position. In the same sense, no employer wants someone with a bad credit history (i.e. financial unreliability) to be hired for a finance position.

These are the kind of things that people will generally not reveal by themselves. It is important to know all of this before choosing to hire someone for a role.

4: Have they actually had the education they claim to have?

Is that Stanford degree real? Or has it been fabricated?

Many people lie about the education they have had, since there is a premium on individuals from top-tier institutions. Without background verification, there is no way to know whether that degree from Stanford is actually real, or has been fabricated.

5: It tells you how honest a person is.

By verifying a candidate’s profile, it is possible to tell how honest that individual is. If there are discrepancies in what is reported by the candidate and what is found by the verification agency, you will know that the person has lied.

If there is one thing that anyone doesn’t want in their company, is a person who cannot be trusted.

So, what’s the problem?

Background verification costs time and money. Every time a new hire is made, a background check needs to be done. Every time a person joins a new company, a fresh background check needs to be done.

This is incredibly redundant, expensive and time-consuming. Big companies can spend hundreds of thousands of dollars every year on just background checks.

How blockchain can help

Everything written on to a blockchain is tamper-proof. Once something is written on blockchain, it cannot be removed, altered, or otherwise tampered with — even by the person who posted it.

This nature of blockchain makes it an attractive solution to the problem of redundant background checks. In the blockchain scenario, once a background verification is done, it will be attested on to the blockchain, and it is not possible to be tampered with.

This means that verification will have to be done once, and can be reliably referred to again and again without any additional cost of time or money. This has the potential to completely disrupt the hiring industry, saving millions of dollars and thousands of man-hours for companies every year.


Read all the related articles here.

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