Excerpt from: National Student Clearinghouse, “Your Organization’s Reputation on the Line: The Real Cost of Academic Fraud.

Not verifying your potential employees’ academic credentials could be costly. Hiring employees who have lied on their resumes or committed academic fraud has wide ranging consequences, including higher turnover. According to various industry estimates, the cost to replace an employee ranges anywhere from $3,500 to $40,000, depending on the salary level. In addition to the financial implications, negative consequences can include lost customers and revenue, exposure to theft and lawsuits, and public damage to your reputation. Such a loss of credibility can take years to overcome.

Many organizations have learned the importance of verifying employees’ degrees the hard way.
  • A Manassas City, Virginia, principal resigned and lost his teaching license in 2014 after it was discovered that he falsified most of his educational credentials, presenting himself as having college degrees he never earned.
  • In 2012, it was discovered that Scott Thompson, the then CEO of Yahoo, had not earned the computer science degree he claimed, but instead had a degree in accounting.
  • David Tovar, Walmart’s former vice president for corporate communications, stepped down in 2014 after it was discovered that he was never awarded the degree that he claimed he received.
  • Herbalife’s CEO, Gregory Probert, was forced to resign in 2008 after it was revealed that he did not have the MBA he claimed.
  • In 2008, The Wall Street Journal reported that J. Terrence Lanni, the former CEO of MGM Mirage, did not receive an MBA he stated on his resume.

Even the federal and some state governments have been victims of academic fraud. A 2008 federal investigation of a diploma mill in Washington State found it had been used by 350 federal employees.

A 2015 investigation revealed that a high-ranking Interior Department federal employee had bought fake academic transcripts online. This employee had worked for the Interior Department as the assistant director of the technology division of the Office of Law Enforcement and Security for over five years and had high levels of access.

The examples are numerous and show that degree fraud can happen to any employer. Verifying degrees helps ensure that your employees have earned the credentials they claim. Furthermore, as potential applicants hear of more and more organizations verifying degrees, they will be less likely to attempt fraud.