Hiring the wrong person can be disastrous for your brand and reputation and extremely costly to fix. The most recent South Australian case of a prominent hire gone wrong, may have a clean-up and legal costs that are likely to approach several hundred thousand dollars. Here, I explore the lessons learnt and what you can do to avoid being next.
What happened?
Last week, news reports emerged of the case against Veronica Theriault, who was recruited to a senior SA government role last May. Theriault has since been sacked from the position and now faces a string of charges, including CV fraud.
The allegations
The prosecution alleges that Theriault:
- Falsely claimed to be an experienced ICT professional with over 20 years in senior leadership positions with some of the world’s largest technology companies
- Faked a number of university degrees
- Acted as her own referee under an alias
- Successfully secured a three-year contract, worth $245,000 a year, as CIO with the SA Department of Premier and Cabinet (DPC).
Later, an Independent Commissioner Against Corruption (ICAC) investigation into the legitimacy of her application led to Theriault’s sacking and subsequently charges of fraud, but not before she granted Alan Corkill, believed to be Theriault’s brother, a contract as “service integration team leader”. Corkill has been charged with aiding and abetting Theriault’s fraud.
Additionally, ICAC has opened a separate maladministration inquiry into the recruitment processes used by the Department, and an internal DPC inquiry has so far resulted in the dismissal of one of the three-person appointment panels and the resignation of another.
The lessons
Lesson #1 – Prevention is Better Than Cure
Effective pre-employment screening would have cost a small fraction of the time and money spent on recruitment and would have prevented Theriault’s fraud and the damage it caused. Instead, the costs of Theriault’s hire are mounting up.
The expense of the two ICAC investigations, the departmental investigation, the dismissal of Theriault and Corkill, hiring their replacements, and the prosecutions of Theriault and Corkill are likely to have already exceeded $750,000 – the total cost of the Theriault’s three-year CIO contract ($245,000 a year).
For the Department, the real damage is political. If a similar fraud had occurred in a private enterprise, comparable costs of investigation, disruption and potential litigation, as well as significant reputational damage, would have been inevitable. Employers who are actively managing the risks in their business (and that should be all employers) are well advised to make the relatively cheap investment in pre-employment screening to avoid the expensive and embarrassing consequences of putting right a mistake.
Lesson #2 – Never judge a book by its cover
In the Theriault case, a panel of high ranking, experienced people were allegedly deceived by the candidate. However, they are not the first to fall foul to CV fraud. In an earlier, unrelated, case, senior executives in a top tier retail business made a similar mistake when appointing a senior manager to a high-profile role. The reality is that no matter how experienced you are, you can never be completely sure you’ll spot a phony during an interview.
Lesson #3 – Check the basics
Routine checks to verify the qualifications claimed on Theriault’s CV would have prevented the fraud in this case and saved the DPC a great deal of pain and embarrassment. The checks you can use to verify previous employment details and qualifications are simple, relatively quick and easily affordable.
To manage the risk of a bad employment decision, they should be routine for every employee you hire.
Lesson #4 – Verify your referee
There are various ways of obtaining a reference, from a quick online questionnaire through to a detailed phone call, or a combination. All are potentially valid – the style of reference should always be appropriate to the position you are filling.
However, as the Theriault case demonstrates, whatever style of reference you obtain, if you cannot be sure who the referee is, you are wasting valuable time and money. Simply relying on a phone number, or email address, supplied by the candidate is leaving you exposed to the risk of CV fraud.
Lesson #5 – Adopt a screening policy and process
A thorough employment screening process is an integral component of risk management and an effective way of minimising and guarding against a range of potential risks.
It allows your organisation to have confidence in the integrity, identity and credentials of your staff and ensures that people you trust in your organisation are worthy of that trust.
More Information
Employment screening is the most inexpensive and effective way for you to protect your business against hiring risks and ensure you’ve made a good investment when hiring staff.
If you are unsure whether your employment screening practices are sufficiently robust, or if you would like some help in developing a suitable procedure, you can contact CVCheck.
Alternatively, you can use Australian Standard AS 4811-2006 Employment Screening as a basis for developing your own industry or organisational specific screening policies and procedures. It applies equally to organisations in both the private and public sector.
