The world of Background Verification (BGV) is undergoing a significant shift today. Driven by rapid technological advancements and a change in global workstyles, traditional methods are being challenged, and new barriers are coming up. This blog delves into this evolving landscape of Background Verification, exploring how technology fuels new forms of identity fraud, how verification adapts to diverse employee segments, navigates intricate compliance hurdles, and embraces industry-specific trends. We’ll also dive into data-driven insights and projections, equipping businesses with the knowledge to navigate the future of BGV with confidence.
Technology has revolutionized the world, and background verification (BGV) is no exception. While automation and digital solutions have streamlined the process, they’ve also opened doors for a new breed of identity fraudsters, armed with sophisticated tools and fueled by malicious intent. Deepfakes, the poster child of this dark evolution, stands as a stark reminder that the future of BGV hinges on understanding and mitigating these emerging threats.
New Technologies Like Deepfakes In The Digital Age And The Challenges They Pose
Imagine a job candidate applying for a high-profile position. Their video interview depicts them seamlessly answering complex questions with expertise, their voice and facial expressions radiating confidence. The only problem? They never existed. Deepfakes, hyper-realistic audio and video forgeries powered by artificial intelligence (AI) can manipulate existing footage to create impossibly convincing personas. This raises a chilling prospect: deepfakes can bypass traditional verification methods, infiltrating recruitment processes and causing significant financial losses. So much so that recently, in a first-of-its-kind case, the Hong Kong branch of a multinational company lost $25.6 million (HK$200 million) after scammers using deepfake technology posed as the firm’s Chief Financial Officer (CFO) in a video conference call and ordered money transfers.
But deepfakes are just the tip of the iceberg. Other technology-driven fraud tactics are constantly evolving:
- Synthetic Identities: Fraudsters leverage stolen data and AI to create entirely fabricated online personas, complete with social media profiles and fabricated work histories.
- Voice Cloning: AI algorithms can mimic someone’s voice with alarming accuracy, enabling impersonation over the phone or even voice-activated systems.
- Document Manipulation: Sophisticated software can alter documents like passports or financial statements, making them appear genuine to the untrained eye.
As technology advances, so will the sophistication of identity fraud. We can expect to see advances in AI that will make it increasingly difficult to discern real humans from fabricated ones. What’s more, even fraudsters will leverage stolen data and social media analysis to tailor their attacks to specific individuals or businesses. With businesses adopting and adapting to new verification technologies, fraudsters will also develop ways to get around them.
Mitigating These Risks In The Digital Age
The fight against technology-driven fraud requires a multi-layered approach:
- Staying informed and continuously monitoring emerging fraud techniques and adapting your verification protocols accordingly.
- While technology plays a role in the line of defence, human expertise remains ever so important for interpreting data and identifying red flags.
- Combine traditional checks like reference verification with digital identity verification, behavioural analysis, and social media screening.
- For high-risk/leadership positions, embracing continuous and ongoing verification can mitigate long-term fraud risks.
- Work with BGV providers who have a deep understanding of emerging threats and best practices.
In terms of ethical consideration, while technology offers powerful tools, its use in BGV raises plenty of concerns that can be summed up in the form of these few questions:-
- How do we balance verification effectiveness with data privacy rights?
- Can AI-powered verification tools perpetuate and eliminate discriminatory practices?
- How do we ensure transparency in the verification process and protect applicants’ rights?
Addressing these concerns requires a human-centric approach:
- Transparency: Be clear about the verification process and obtain informed consent from applicants.
- Ethical data handling: Ensure data is collected, stored, and used with regulations and only for legitimate purposes.
- Human oversight: Utilize AI responsibly, with human expertise guiding decision-making and mitigating potential biases.
AuthBridge offers a seamless solution to counter risks like Deepfakes and the lot with its Video KYC solution. Our Digital KYC solution enables end-to-end seamless user onboarding journeys through AI-powered facial recognition, liveness detection, OCR, and geotagging technologies to catch identity and financial fraud before onboarding new users.
Future Of BGV For Different Working Classes
Like the world of BGV, the post-pandemic world of work has undergone a seismic shift, that includes blue-collar, white-collar, and gig workers. This transformation demands a nuanced approach to background verification, one that moves beyond the one-size-fits-all model of the past. By understanding the evolving needs of each workforce segment, businesses can tailor their verification strategies, optimising efficiency, and accuracy and mitigating risks. According to a report by MarketsandMarkets, the global background check market is expected to grow from $4.8 billion in 2020 to $8.8 billion by 2025, at a compound annual growth rate (CAGR) of 13.0% during this period.
Blue-Collar Worker Verification Trends
Blue-collar workers are individuals who perform manual labour or skilled trades as their primary occupation. Often associated with wearing uniforms, overalls, or work clothes, they are the driving force behind various industries requiring hands-on work and technical expertise. Examples of blue-collar workers include Carpenters, electricians, plumbers, construction workers, mechanics, farmers, truck drivers, welders, etc. Beyond the manual aspect, many blue-collar professions require significant training and specialised knowledge. While some roles demand physical strength and endurance, others emphasise meticulous attention to detail and technical expertise.
When onboarding and verifying blue-collar workers for any company, the safety and reliability of these personnel become things of paramount consideration for companies. Traditional checks like employment history verification remain relevant, ensuring candidates possess the necessary experience and skills for the job. However, with increasingly specialised roles emerging in construction and manufacturing, technical skills assessments and certification verification are gaining importance. Additionally, drug screening, as part of the background check for employment, might be crucial for safety-sensitive positions, while driving record checks are essential for those operating vehicles. According to a 2022 report, 3% of blue-collar workers may have a civil or criminal record.
In terms of validation, extensive educational background verification, unless directly relevant to the specific role will remain as important as ever. In-depth reference checks for long work histories, as online platforms and skills assessments, offer more current and objective data and thus will continue to play an important role in the world of background verifications.
Regarding the future of Blue-Collar BGV trends, a few things are quite clear. Skills-based assessments will become more important than before and online platforms that can evaluate specific technical skills relevant to the job will see a massive increase in demand. With the changing requirements of companies, industry regulations and standards will see changes and hence, compliance with the same will become important. Gauging work ethic and potential safety concerns based on online presence based on Social Media screening will also become important.
White-Collar Worker Verification Trends
While “blue-collar” workers tackle physical tasks like building, fixing, and farming, often in practical attire, “white-collar” workers delve into information, communication, and planning in office settings, typically sporting business attire. White-collar workers include managers, accountants, lawyers, doctors, teachers, engineers, writers, marketing professionals, sales representatives, etc. Their work involves tasks like Information processing and analysis, communication and collaboration, planning and organization, problem-solving and decision-making, using computers and other technology.
For white-collar professionals, trust and integrity, hence, are crucial. Educational qualification verification remains vital, but professional license verification and disciplinary history checks are increasingly important. Financial checks, including sanctions screening, might be required for positions handling sensitive financial data. Additionally, reference checks from previous employers and professional associations offer valuable insights into work ethic and performance. Our research suggests that there was a concerning growth of 6% in discrepancy rates recorded between FY 21-23.
Potential Frauds in White-Collar Worker Verification include Diplomas, certificates, or licenses that can be forged or manipulated to appear legitimate. Applicants might exaggerate their experience, skills, or qualifications on resumes or during interviews. Individuals may use another person’s identity to gain employment, potentially posing security and legal risks. Fabricating research, plagiarism, or purchasing fake degrees can occur, impacting professional integrity and credibility. Uncovering hidden financial issues like bankruptcies or fraud requires in-depth checks beyond standard job background screening checks.
Redundant checks might include:
- Physical address verification, as contact information can be easily updated.
- Generic personality tests, such as behavioural analysis based on work history and online presence can be more informative.
New checks to consider:
- Professional network analysis: Examining online connections to assess professional reputation and potential conflicts of interest.
- Social media screening: Identifying potential red flags related to integrity and ethical conduct.
- Continuous monitoring: For high-risk positions, ongoing verification of professional licenses and financial standing might be necessary.
One of the most important checks in the White-Collar worker verification process is Leadership and executive position checks. These positions within white-collar industries carry significant responsibility. These individuals make critical decisions impacting the company’s trajectory, finances, and reputation. Therefore, conducting thorough leadership/executive screening as part of the background checks and employment process is crucial.
The leadership/executive screening goes beyond the standard checks conducted for other employees and typically includes:
- Comprehensive education and employment verification: Confirming degrees, professional licenses, and work history with meticulous accuracy, including dates, titles, and responsibilities.
- Financial background checks: Uncovering potential credit issues, bankruptcies, or financial ties that could pose conflicts of interest.
- Legal and regulatory checks: Reviewing civil and criminal records, sanctions lists, and any prior legal proceedings to assess potential risks.
- Reputational due diligence: Utilising specialised tools and research to uncover potentially damaging media coverage, online activity, or public controversies associated with the candidate.
- Social media screening: Analysing publicly available social media profiles to assess for potential red flags concerning integrity, judgment, or alignment with company values.
- Reference checks: Conduct in-depth conversations with past employers, colleagues, and other relevant individuals to gain deeper insights into the candidate’s leadership qualities, ethics, and performance history.
AuthBridge has a product under its belt, AuthLead, that can help power up your Leadership Due Diligence.
Gig Workers Verification Trends
Gig workers, also known as independent contractors or freelancers, are individuals who perform temporary or project-based work for different clients instead of holding a traditional full-time employment position with a single company. They usually find work through online platforms, direct contracts, or word-of-mouth referrals.
The gig economy has undergone a dramatic change, evolving from a platform market size valued at USD 5.1 Billion in 2022 and is likely to reach USD 18.3 Billion by 2031, expanding at a CAGR of 15.1% during the forecast period, 2023–2031. Fueled by the smartphone revolution and changing work preferences, platforms like Uber, Lyft, and DoorDash became household names, attracting nearly 5 million people in the US alone just for platform-based gigs in 2021, as per the University of Chicago. This explosive growth, however, wasn’t without its growing pains. Concerns about worker rights, benefits, and the dominance of major platforms sparked legal battles and regulatory discussions, pushing the industry towards maturation and scrutiny.
Despite these challenges, the future of the gig economy seems bright. Its expected sustained expansion will be driven by factors, including changing work preferences, technological advancements, and economic realities. However, addressing ongoing concerns is paramount. Policy and regulation are likely to evolve, seeking to balance innovation with worker protections and fair competition. Additionally, upskilling gig workers, exploring portable benefits solutions, and even potential platform evolution offering more support are all on the horizon. While navigating the delicate balance between innovation and fair treatment remains critical, the gig economy’s future can create a flexible, adaptable, and inclusive work environment for businesses and individuals, shaping the workforce landscape for years to come.
Gig workers present a unique challenge due to their fluid work history. Traditional employment verification might be limited, necessitating alternative approaches. Skills assessments and platform-based verification can provide valuable insights into experience and competence. Reputation management and social media screening can help gauge work ethic and client satisfaction. Additionally, independent references and digital identity verification can offer further reassurance.
Redundant checks might include:
- Extensive criminal background verification and checks unless the role involves sensitive information or high-security risks.
- Traditional reference checks, such as platform reviews and independent references might be more relevant.
New checks to consider:
- Platform-based performance metrics: Analyzing data on completed tasks, client reviews, and project completion rates.
- Independent contractor verification: Confirming the legitimacy and legal compliance of the worker’s business entity.
- Skills assessments: Evaluating specific skills relevant to the gig tasks and platform requirements, for example, Drug Tests when onboarding drivers for a ride-hailing platform.
The gig economy buzzes with activity, but verifying worker credentials often feels like a disorganized juggling act. From licenses and face checks to endless paperwork, traditional methods create redundancy and eat up valuable time and resources for both platforms and workers.
Imagine an industry-wide data pool where platforms like Uber and Ola seamlessly access verified information on drivers, eliminating duplicate checks and paperwork fatigue. That’s what AuthBridge delivers. Our comprehensive suite covers everything from credential and face match verification to licence and RC checks, all secured by cutting-edge data-sharing technology. The result? Platforms enjoy faster, cheaper, and more secure verifications, while workers benefit from a smoother, more transparent experience.
Beyond Redundant Checks: The Future of Tailored Verification
As technology evolves, so will background screening for job verification strategies. Emerging trends like AI-powered document verification, behavioural analysis, and continuous monitoring offer promising tools for tailored verification across different workforce segments. However, it’s crucial to remember that technology should complement, not replace, human expertise and ethical considerations.
The future of background verification (BGV) is not simply a linear path, but rather a labyrinthine journey through a complex landscape of ever-evolving regulations, cultural nuances, and diverse interpretations of what it means to ‘verify an employee’ Navigating this landscape requires not only a deep understanding of the legal frameworks across different regions but also a sensitivity to the cultural and societal norms that shape how verification is conducted and perceived.
Technology is undoubtedly the primary driver of change in BGV. Here are some key trends worth noting:
- AI-powered solutions: Artificial intelligence (AI) is revolutionizing BGV with its ability to automate tasks, analyse vast amounts of data, and identify hidden patterns. AI-powered document verification, risk assessments, and behavioural analysis are transforming the speed and accuracy of verification processes.
The global Background Check market size was valued at US$ 2574.91 million in 2021 and is expected to expand at a CAGR of 8.39% during the forecast period, reaching US$ 4174.85 million by 2027.
- Continuous monitoring: Traditional, one-time BGV checks give way to continuous monitoring solutions. This allows for real-time updates on changes in an individual’s professional qualifications, licenses, or reputational standing, mitigating long-term risks for high-risk positions.
- Blockchain technology: Blockchain’s secure and transparent data storage capabilities hold immense potential for BGV. It can streamline data sharing between organizations, eliminate fraud, and empower individuals with greater control over their personal information.
Industry Projection: Forecasts suggest that global blockchain technology revenues will experience massive growth in the coming years, with the market expected to climb to over 39 billion U.S. dollars in size by 2025. One-size-fits-all approaches are fading and are sure not the way around for the future. Tailored verification strategies based on specific risk profiles and workforce segments are vital.
Here’s a glimpse into the future based on industry data and projections:
- Mobile-first verification: On-the-go checks through mobile apps will become increasingly prevalent.
- Real-time data integration: BGV will seamlessly integrate with other HR systems, streamlining workflows and expediting hiring decisions.
- Focus on skills verification: As skills-based hiring gains traction, skills assessments and platform-based performance metrics will become crucial.
- Demand for global BGV providers: Businesses operating internationally will rely heavily on providers with expertise in navigating diverse regulations and cultural nuances
A Global Perspective Of BGV Regulations
The landscape of work is shifting dramatically, with the global talent pool becoming increasingly accessible thanks to technology and remote work opportunities. According to another report, Approximately 1.57 billion people are self-employed around the globe, with the figure accounting for nearly half (46.4%) of the global workforce, highlighting the rise of flexible arrangements. This trend, coupled with research by Gartner stating that by 2030, the demand for remote work will increase by 30% due to Generation Z fully entering the workforce and 64% of today’s professionals saying they could work anywhere and remote work policies are common (in place at 71% of organisations) creates a complex scenario for background verification across international borders.
Moving forward, navigating the global background verification landscape necessitates a multi-pronged approach. Partnering with reputable verification providers with international expertise and access to accurate data sources is crucial. Utilising technology like AI-powered tools can expedite and streamline the process. Tailoring checks to specific roles, industry regulations, and the remote work setting remains essential for mitigating risks and ensuring a qualified and trustworthy workforce. By staying informed about evolving regulations and adopting these strategies, organisations can navigate the evolving world of background verification in a globalized and remote working environment.
Let us now take a closer look at the regulatory landscape across three major regions in the world:
European Union (EU)
The regulations that exist in the European Union (EU) come out as one of the strictest regulations in the entire world. The General Data Protection Regulation (GDPR) reigns supreme here, demanding explicit consent from individuals for data collection and processing, stringent data security measures, and limitations on data storage and sharing.
As far as the impact on the world of Background Verifications and the trends in the future are concerned, Businesses must tread carefully, obtaining consent from candidates, employing data anonymization techniques, and adhering to strict data retention and transfer limitations.
In terms of the challenges that lie ahead, balancing verification needs with privacy rights, managing cross-border data transfers, and keeping pace with evolving interpretations of GDPR come out on top as some of the top challenges.
Asia Pacific (APAC)
When talking about Asia Pacific (APAC), there is no single rulebook that can be applied to all countries in that region. Each country has its data privacy laws, ranging from Singapore’s stringent “Personal Data Protection Act (PDPA)” to India’s “The Digital Personal Data Protection Bill, 2022” with similar privacy-focused regulations.
Their impact on BGV varies from country to country as well. Businesses must navigate a patchwork of regulations, adapting verification processes and data handling practices to comply with individual country laws. When talking about challenges, adapting to evolving regulations across diverse countries, ensuring consistency in BGV practices, and managing data localization requirements are some of the top considerations and trends to look out for.
Latin America (LATAM)
Latin America (LATAM) is one region where we can see an emerging landscape as far as the regulations for data privacy and BGV are concerned. While individual countries like Argentina and Brazil have data privacy laws, others are still developing regulations.
The impact of this on Background Verification is varied as well. Businesses must navigate an evolving legal landscape, balancing local data privacy rights with international compliance requirements. The challenges that will pop up regarding this include staying up-to-date with evolving regulations, ensuring consistency in BGV practices across different countries, and navigating a lack of harmonization in regional data privacy laws.
Businesses operating globally must navigate a complex web of regulations, requiring expertise and proactive compliance strategies.
Going Beyond Regulations As Cultural Nuances Shape BGV
Compliance goes beyond ticking legal boxes; it’s about understanding cultural attitudes towards data, privacy, and trust. In individualistic cultures like the US, BGV might focus on verifying qualifications and mitigating legal risks. In contrast, collectivist cultures in Asia might emphasize verifying character, social reputation, and cultural alignment with the organization. Recognizing these differences is crucial for tailoring BGV procedures and building trust with candidates.
The very definition and purpose of BGV can vary across regions. In the US, BGV primarily focuses on verifying candidate claims and mitigating legal risks. In Japan, however, it might emphasize building long-term trust, assessing cultural fit, and ensuring a candidate’s harmony with the company’s values. These differing mindsets necessitate flexibility and a willingness to adapt to regional expectations.
The future of BGV points towards increasing globalization, with even more complex regulatory landscapes and diverse candidate populations. To navigate this labyrinth effectively, businesses can:
- Partner with Global BGV Providers: Leverage their expertise in navigating regional regulations and cultural nuances.
- Embrace Technology: Utilize tools like data anonymization and blockchain for secure and compliant data management.
- Stay Informed: Continuously monitor evolving regulations and adapt BGV processes accordingly.
- Practice Transparency: Be clear about data collection, usage, and storage practices with candidates.
- Prioritize Ethics: Respect data privacy rights and ensure fair and unbiased verification processes.
Decoding Trends In The Background Verification Space
The world of Background Verification stands at a precipice, poised for transformation on multiple fronts. Driven by technological advancements, evolving regulations, and changing workforce demographics, this industry is shedding its traditional skin and morphing into a sophisticated ecosystem that caters to diverse needs and challenges. To navigate this complex and dynamic landscape, understanding the emerging trends shaping the future of BGV is crucial. It is crucial to embark on a journey through this data-driven exploration, analyzing industry-specific trends, projections, and their potential impact on the way we verify identities and mitigate risks.
Ethical Considerations: Balancing Security And Privacy
In today’s data-driven world, ethical considerations take centre stage in background verification, particularly when balancing security needs with individual privacy. Obtaining explicit, informed consent from the individual undergoing the check is fundamental. This empowers them to understand the scope of the verification, data collected, and its intended use. Transparency builds trust and allows individuals to address potential discrepancies proactively.
The ethical use of technology and data privacy are paramount concerns:
- Algorithmic bias: Ensuring AI-powered solutions are unbiased and do not perpetuate discriminatory practices.
- Data privacy: Balancing verification needs with individuals’ right to privacy and data security.
- Transparency and fairness: Communicating the verification process and ensuring fairness throughout.
However, consent alone isn’t enough. Responsible data processing and storage are equally crucial. Data collected during verification should be limited to what’s necessary for the specific role and job requirements. Secure storage practices using encryption and access controls must be implemented to safeguard sensitive information from unauthorized access or misuse. Additionally, adhering to relevant data privacy regulations like GDPR or CCPA ensures compliance and protects individual rights.
Ethical considerations are not just moral imperatives, but also business necessities for building trust and maintaining compliance.
About AuthBridge
With over 18 years of experience in the industry, AuthBridge has been at the forefront of creating databases, and building algorithms to enable instant searches to perform background checks without compromising on data security. AuthBridge is trusted by over 2,000 clients in 140 countries for their background check needs. Our database contains over 1 billion proprietary data records for conducting background checks. AuthBridge conducts an impressive volume of 15 million background checks every month.
