How to protect your company from document fraud

How to protect your company from document fraud

Document fraud is a growing issue, and if unspotted in the recruitment process can pose serious risks to your business, your workers, and your customers.

Document fraud is defined as the submission of false documents to obtain financial or capital gain, illegal entry into a country, or other benefits. In recruitment, this can include submitting false identification documents to fraudulently claim a right to work in the UK, or can include presenting fake qualification certificates. It’s vital that employers take reasonable steps to protect their company from document fraud.

The risks of document fraud

Employers who are caught knowingly employing people who do not have a right to work in the UK face criminal charges, which can land them with unlimited fines or even imprisonment. But even if the employer isn’t aware that their employee is an illegal worker, they could be liable for a fine of up to £20,000, unless they can prove that proper care has been taken to ascertain whether or not the documents they’ve presented are genuine.

If an employee working in a regulated sector such as health, pharmaceuticals, finance, or education is found not to have the required qualifications, employers can be legally liable and at risk of investigation for regulatory noncompliance or malpractice.

Beyond the civil penalties for employing illegal workers or unqualified workers, businesses could also face greater risks – individuals who’ve obtained employment using false documents are also higher risk for committing fraud or data theft in their roles, potentially causing greater liability for employers if there’s a data breach. False qualifications or documents such as driving licenses could also mean employees are a direct threat to the safety of other employees or customers, with potentially serious consequences.

How document fraud is changing

When verifying an employee’s Right to Work in the UK, ID Verification Technology (IDVT) has been shown to be more effective at identifying fake ID documents, meaning fraudsters are likely to target in-person checks rather than going through digital identity verification processes, which could be more likely to refuse them.

However, it’s important to note that while using IDVT is a more effective way of spotting fake ID documents, employers cannot enforce its use. There are a number of legitimate reasons as to why an employee may need to be processed using the manual Right to Work checks process (not least that currently IDVT can only be used with a full, in date UK passport). This means that while employers can reduce their risk of fraud by encouraging applicants to use IDVT, they also need to be increasingly vigilant of fraudulent documents during in-person checks.

Qualification fraud is a growing issue, particularly as we digitise the recruitment and hiring process. Many employers aren’t meeting candidates face to face, and original documents or papers are sometimes only ever seen briefly on a video call, or seen as a scan or photograph. This makes validating certificates and documentation more challenging, leaving the door open for fake or forged qualifications to pass muster.

How to reduce the risk of document fraud

Learn how to spot fake documents - The quality of false documents of all kinds is significantly better than most people expect. There’s a lot of money to be made from fake documents, and fraudsters invest large sums into obtaining the technology that can replicate everything from perforations and watermarks to UV-reactive paper, holograms and even laser engraving. This means that high quality fake passports, driving licences, and certificates can be difficult to spot.

Ensuring your team undergoes training to spot common tell-tale signs of fakes, as well as checking elements like documents numbers against services which catalogue lost or stolen documents can help to flag anything suspicious.

For qualifications, as well as faked certificates from genuine educational institutions, employers should also be wary of qualifications from bogus universities, which are very widespread: for each genuine university, there’s a fake, “shadow” university. HEDD, the UK higher education’s official degree verification service, hosts a database of bogus institutions, and can check certificates and qualifications against it to ensure their legitimacy.

Look out for stolen documents  - Document fraud constitutes not only the use of fake or forged documents, but also the use of someone else’s genuine documents that have either been borrowed, stolen, or sold. Therefore, it’s important to ensure that ID documentation genuinely belongs to the candidate in question.

In some cases, applicants could have completed verification via an IDVT, but the person who then turns up to work is not the same person. Checking that new employees are indeed who their ID says they are is essential before they start work.

Ensure robust internal processes

As fraudsters get better and better at creating convincing forgeries, fake documents can be virtually impossible to spot.

While the goal is to prevent illegal or unqualified workers from successfully committing fraud, the worst can sometimes happen; in those cases it’s important that you can prove that you’ve taken as many steps as you reasonably can to prevent document fraud in your business.

Therefore, accurate record keeping is key – being able to prove that checks have been made by suitably trained people can help you to make the case that robust measures were put in place. While investment in training and technology is not strictly required, it not only helps to catch fraudsters, but also gives a good impression to regulators should they have cause to investigate your business.

It's also vital that you maintain high levels of data security around your employees’ personal information – businesses can be a source of stolen documents as well as the potential victims of fraud, so ensuring that copies of documents are held securely and that access is restricted only to those who require it is important too.

Stay protected with Reed Screening

To ensure your business protects its employees, reputation, and business performance when working against dishonest candidates or fraudulent employers, robust screening and secure processes are key.

Pre-employment screening can help you minimise the risk, both in terms of legal liability and in terms of lost productivity and performance from an unsuitable hire. At Reed Screening we specialise in providing fast, accurate screening services that give you the confidence that your employees can be trusted, allowing you to get on with growing your business.

To find out more, get in touch today.