How Blockchain Is Fighting Job Scams
A Federal Trade Commission report released earlier this year debunked the commonly held belief that victims of scams are primarily the elderly. Rather, it found that 40% of fraud reporters in their 20s lost money to scammers, while only 18% of victims aged 70 or older reported a loss. Millennials and younger generations may be more prone to falling for scams because they’re more likely to be exposed to scams. That’s certainly consistent with a 2015 survey from FlexJobs, which found that 20% of respondents aged 20–29 had been scammed through a job site, while only 14% of respondents aged 60–69 reported the same. The FlexJobs survey also showed just how prevalent job scams are, estimating that 60 to 70 job scams exist for every legitimate job posting.
The fact that millennials fall for job scams more frequently than the older generation reflects the fact that tech-savviness and online literacy isn’t enough to protect against fraud. The common platitude “if something sounds too good to be true, it is” is good advice, but scammers can still fool intelligent, tech-savvy, educated individuals by appealing to their basic human needs. What working parent wouldn’t want a work-from-home job so they can spend more time with their kids, and what debt-strapped graduate wouldn’t want a sizeable entry-level salary? Scammers prey on desperate people whose desire for these things may override their common sense.
That’s why at BHIRED, while we understand that educating people about protecting themselves from scams and legal action against scammers is important — we believe it is not enough. Job platforms themselves have to fight back, implementing design features that protect users. And that’s why we built the BHIRED platform on a blockchain.
One of the blockchain’s many applications is providing an immutable source of shared truth. The same distributed ledger technology that protects the Bitcoin network from double-spending scam attempts can also safeguard hiring and recruiting platforms like BHIRED. Here’s how:
Verifying Identity
For job scammers, obscuring their true identity is crucial to success. Scammers may pretend to represent a company they don’t belong to by copying that company’s logo or signature information. Because repeat scammers will quickly build a public reputation on scam reporting websites, they often move between fake identities, discarding one and making another.
When job seekers, hiring managers, or recruiters join the BHIRED platform, they must undergo biometric verification to record their identity on the blockchain. Reviews, verified credentials, and other behavior are recorded on the blockchain in association with a user’s profile. In BHIRED, identity becomes a precious and well-established asset. Scammers can’t merely set up a new profile with a new email address and call it a day. Creating a new blockchain-based identity takes time, resources, and personal information; this prevents the creation of multiple low-quality profiles.
Incentivizing Responsible Behavior
Users on recruiting sites — just like users on virtually any other social media platform — create the site’s value. Job boards don’t work if no one is posting openings or resumes. And plenty of job board users actively harm the site’s value by misbehaving, whether that means spamming openings with irrelevant resumes or trying to scam job seekers.
BHIRED uses a blockchain to incentivize good behavior and disincentivize bad behavior. All members of the BHIRED ecosystem receive a ranking of one star when they join and can build up their ranking by adding and verifying information on their profile. Higher rankings don’t just indicate users’ trustworthiness, they also result in higher platform visibility and more BHIRED token income for candidates when recruiters or hiring managers click on their profiles.
Many job scammers approach their targets by sending unsolicited emails, using addresses harvested from resume boards. On the BHIRED platform, contacting a candidate isn’t so simple; recruiters must pay a BHIRED token fee to reach candidates, paying more for candidates who are willing to share their most trusted and verified information with the platform. Spammers usually succeed on job boards because they only need a handful of people to fall for their tricks out of the hundreds or thousands of people they contact. However, BHIRED’s blockchain incentivization makes approaching mass numbers of people, instead of diligently hunting for candidates, economically prohibitive. Reviews and rankings also alert candidates when recruiters or hiring managers are unprofessional or even possibly scammers.
Automating Tamper-Proof Transactions
A blockchain’s ledger helps verify identity and incentivize good behavior by providing an indelible record of truth. Many of the platform features on BHIRED — such as automatic transfer of tokens when recruiters click on candidates’ profiles — are made possible through smart contracts. Smart contracts are computer protocols that self-execute when pre-determined conditions are fulfilled. On BHIRED, smart contracts reduce the administrative burdens of operating a robust, anti-scam platform. Smart contracts are crucial to the “time locked truth share” mechanism that helps users verify each other’s blockchain-encoded information. Because they are inherently tamper-proof, smart contracts keep scammers from interfering with the token exchanges necessary for proper incentivization or the verification processes that protect users from falsified information.
Job searchers, hiring managers, and recruiters need to be aware of scammers, but awareness isn’t always enough to foil scam attempts. The fundamental technology underlying how we search for jobs and candidates has to change to better protect all participants. At BHIRED, we believe that radical technological change will come from a blockchain.
