Nearly 2 Lakh risky white collar hires were flagged before onboarding
FinTech BizNews Service
Mumbai, 22nd January 2025: IDfy, India’s leading identity Trust Stack with global expertise and enterprise-grade technology solutions for integrated identity verification, has released its Report on Workforce Risks and Hiring Fraud for the year 2025, revealing that Indian companies lost over Rs. 150 crore to employee-led, collusion fraud during the year.
The report is based on 4.9Mn real cases processed by IDfy in 2025 and draws on the company’s 14 years of experience in identifying identity, employment, and compliance risks across industries.
In 2025 alone, 195,163 suspicious white-collar hires were flagged by IDfy before they
could be onboarded, underscoring how fraud has scaled in both volume and sophistication.
This report deep dives into high-risk sectors and trends leading to fraud, while also talking
about industry-specific recommendations.
The report finds that fraud in 2025 did not spare any sector and increasingly surfaced in
industries once considered low-risk. Telecommunications, a historically low-risk sector’s
fraud rate that jumped from 7.7% in 2024 to 10.02% in 2025, and emerged as one of the most
vulnerable sectors. Given telecom employees’ access to customer identities, SIM data, and
network systems, even a single fraudulent hire can trigger large-scale data breaches and
compliance fallout. Consumer-facing industries such as FMCG also reported elevated fraud
levels, while insurance, consulting, IT/ITES, and BFSI continued to face persistent hiring and
insider risks.
One of the most concerning trends across sectors was the sharp rise in fake and forged
documents, which emerged as the single biggest red flag in white-collar hiring. On average,
one in every five red reports generated in 2025 was triggered by fabricated paperwork.
Education verification was the most exploited CV point, with 69.9% of all fraud cases
originating from fake and forged documents, compared to 16.9% in employment
credentials. The increasing use of AI-generated degrees, shell employers, and document
fabrication networks has significantly weakened traditional verification methods.
Commenting on the findings, Ashok Hariharan, Founder & CEO, IDfy, said, “Employee
fraud today is no longer opportunistic - it is organised, repeatable, and increasingly
tech-enabled. What we’re seeing is not just candidates exaggerating credentials, but entire
ecosystems built around fake degrees, shell employers, impersonation, and insider misuse of
access. When nearly 70% of fraud cases originate from forged credentials, it’s clear that trust
can no longer be assumed at any stage of hiring. The cost of a bad hire today isn’t limited to
salary loss; it shows up as data exposure, stalled operations, regulatory scrutiny, and
long-term erosion of customer trust. Organisations that don’t verify early and monitor
continuously are effectively betting their business on blind spots.”
Fraud patterns also showed a clear geographic spread. While six cities accounted for 40% of
all fake document cases in 2024, fraudulent activity in 2025 expanded well beyond traditional
hotspots. While metro cities such as Mumbai, Bengaluru, Pune, Gurgaon, and Hyderabad
continued to report high volumes of forged education and employment records, newer
hotspots, including Thane, Chennai, Gautam Buddha Nagar, Mysuru, and Indore,
highlighted how white-collar employment fraud is no longer concentrated in a few urban
centres.
Among regulated industries, Banks and NBFCs recorded the highest fraud risk in 2025,
with overall fraud rising from 11.00% in 2024 to 12.01%, the highest across all industries.
The sector also saw a sharp increase in candidates with adverse legal histories, as court cases
and FIR-related red flags climbed from 0.90% in 2024 to 2.53% in 2025. With over 70% of
employees in BFSI handling sensitive personal and financial data, a single bad hire can lead
to severe regulatory, financial, and reputational damage.
The insurance sector reported an overall fraud rate of 4.85%, driven largely by fake
experience claims within advisor networks, and also recorded the highest legal history fraud
rate across industries at 2.73%. In IT/ITES, overall fraud stood at 7.55%, with employment
fraud rising to 7.38% amid intense demand for specialised digital and AI roles. This sector
also recorded the highest incidence of ID proof fraud, at 4.74%, reflecting growing
impersonation and identity manipulation risks.
Looking ahead, the report identifies deepfake-enabled impersonation, AI-generated
credentials, insider fraud, and the growing use of shell entities as key risks to watch in
2026. With almost 1 in 8 BGV reports turning up red, waiting until onboarding to identify a
bad hire is a risk. Pre-offering instant, yet detailed screening acts as a safety net, helping
verify who’s genuine before the offer is made. IDfy emphasises the need for early-stage
screening, continuous monitoring, and adaptive, AI-led verification systems to help
organisations stay ahead of rapidly evolving fraud patterns.
