Employers admit candidates faking identities with AI are outsmarting them, with fraudulent hires costing companies thousands

• Report claims AI helps candidates deceive employers faster than outdated hiring systems can detect
• Managers report major hiring losses and growing concerns over AI-driven applicant fraud
• Employers respond with training, updated protocols, and multi-layered protections

A new report suggests AI is transforming hiring practices in ways that can expose companies to risks that are harder to spot.

The study by background check platform Checkr surveyed managers across a range of industries to better understand the rise of candidate deception.

The findings suggest hiring is becoming increasingly susceptible to fraud, and that technology is giving job seekers tools that are often more advanced than the systems used by employers to detect them.

Better at faking their identities

Just 19% of managers surveyed said they were confident that their hiring process could catch a fraudulent applicant.

Nearly two-thirds believed candidates are now better at faking their identities with AI than employers are at spotting them.

Of the tactics that are worrying managers the most, 59% said they had suspected candidates of using AI to misrepresent themselves, while 31% reported interviewing someone later revealed to be using a false identity.

More than a third said another person altogether had appeared in a candidate’s place during an interview.

Concerns stretch beyond hiring mistakes. 60% of managers said they had caught applicants misrepresenting their experience or qualifications.

Nearly one in four managers estimated their companies had lost more than $50,000 in the past year because of fraudulent hires, with one in ten reporting losses above $100,000.

In some good news, despite all the risks, the report shows that many employers are beginning to adapt to the various problems.

Almost two-thirds of respondents said their organizations had updated the hiring protocols in the past year to address identity and AI-driven fraud, and more than 60% said HR teams had received training to spot red flags during the hiring process.

With regard to strengthening defenses, 36% favored in-person verification, 31% pointed to AI fraud detection software, and 24% opted for stronger background checks.

The survey says employers are moving toward multi-layered protection rather than relying on a single safeguard.

They will need to balance the speed of recruitment with the need to verify authenticity however, and that will be far from easy.

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