The Jon Lee scandal is why CEOs should not be exempt from background checks

Jon Lee, former CEO of Vizzio Technologies, was embroiled in controversy after it came to light that he had misrepresented his academic qualifications, specifically his PhD credentials. 

This revelation led to an apology from Lee and subsequent leadership changes at Vizzio, with David See taking over as interim CEO. The company also introduced stronger governance practices to ensure its integrity. Despite the initial support from the board, the incident led to some partners reevaluating their ties with Vizzio.

For me, the issue here is less about dishonesty and integrity, but more about whether we as a nation have become too lackadaisical when it comes to verifying one’s claims and background. Technological tools today also have made it easier for people to forge documents and cheat their way up.

Who better to help elucidate this glaring issue than Fiona Cher, who is now the director of government affairs with Veremark, a B2B background screening and reference checking platform. Cher was also one of the few background screening leaders who advised and worked closely with the Ministry of Manpower even before they launched their latest regulations governing education fraud among foreign workers in Singapore (COMPASS).

In a Reddit post, some commentators mentioned that C-suite leaders typically don't get their background checked or certified before they are appointed. Is this a common phenomenon you're seeing, and if so, which sector is most guilty of this oversight?

It is not really a sector problem but a company issue. Whether background checks and due diligence are being done ultimately depends on each company's organisational policy and risk appetite. Resume fraud is a widespread problem for employers in every industry and at company of all sizes.

Some companies in regulated sectors do background checks because they are made to, while others skip because they either think they won't get caught or because the regulators have yet to come after them. At the same time, some companies in non-regulated industries enforce background screening in their firm, but many more don't because there's no mandate for their industry to do so.

It’s also sector-dependent. Certain sectors, such as the heavily regulated banking and finance industry, check every employee — C-suite leaders included — enforcing more stringent background checks on the company's senior or strategically essential roles. 

But I've also seen companies within regulated industries who don't bother doing it because they don't think they'll get caught. 

Is this controversy more about a dishonest CEO or the fact that he does not technically have a PhD? How does that reflect how we view leadership and entrepreneurship in Singapore?

The controversy has sparked significant public uproar for several reasons. Firstly, the individual in question, Jon Lee, was able to deceive people not once but twice by fabricating higher academic qualifications from prestigious institutions like MIT, Stanford, and Cambridge. It raises deeper concerns about the extent of dishonesty. If Jon Lee could lie about his credentials and evade detection for so long, it begs the question of what else he might have fabricated or lied about.

The situation is further exacerbated by the apparent double standards in handling such cases. Online, readers are furious because they’re comparing fraud to another recent incident in Singapore, where a female employee was sentenced to eight months in jail for faking a Bachelor's Degree from NTU to secure jobs over 16 years. Another Singaporean who was jailed for two years in 2019 for using a forged diploma and impersonating referees while applying for jobs.

In stark contrast, Jon Lee, who faked even higher credentials and deceived his investors, employees, clients, and board of directors with millions of dollars at stake, is not facing jail time. 

Moreover, the lack of punitive action against Jon Lee sends a troubling message that falsifying credentials or lying about clients might not have serious legal consequences. It suggests that the risk of exposure is the only deterrent, and even if caught, a simple apology might suffice and you can still keep your job. 

This uncertainty shakes the foundation of trust and questions the reliability of what we can perceive as honest or truthful. It is not just an issue about an individual’s deceit, but reflects the gaps in our current system and broader concerns about integrity and ethical standards in professional and academic environments.

What do you think of the Board of Directors' initial decision to stand by CEO Jon Lee even after he admitted to misrepresenting his credentials?

I was appalled. The public uproar that ensued is a clear testament to how that was clearly a wrong move. Endorsing a CEO who has lied not once but twice only served to signal questionable judgment by the board and has led to significant reputational damage.

This is not about "not sanctioning" someone for their past mistakes or giving them a second chance, but about how the board allowed someone (a CEO at that) to blatantly lie and yet not hold them accountable.

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Is the problem of accountability systemic?

The case of Jon Lee's fraudulent academic claims is far from an isolated incident in Singapore, pointing to a broader, more systemic issue. Historical cases highlight a recurring pattern of individuals faking academic qualifications to secure prestigious positions. 

Even though it happened years ago, the public still remembers the cases of a foreign employee at Infocomm Development Authority (IDA) in 2015 who fabricated her Master's degree and a Raffles Education director exposed in the same year for possessing multiple fake certifications (Bachelor's, Master's, and PhD). And then there's the 2018 case of Mike Brochez, who managed to deceive both Temasek Polytechnic and Ngee Ann Polytechnic with falsified qualifications (Bachelor's, Master's, PhD, and a professional teaching certificate).

It’s quite evident that Singapore still has not learnt from the Western world when it comes to enforcing background checks. 

For instance, in 2008, the UK government took a significant step towards achieving this goal by introducing the Employment Background Check Act, a law that mandates employers to incorporate rigorous background screening into their hiring process. The rationale behind these regulations was straightforward: to foster fairness and transparency in the employment sector and safeguard the interests of both employees and employers. 

In my line of work, I’ve also caught people inflating their salary (to secure a higher pay), their past job title, and signing forms to declare they do not have a criminal record or links to any politician.

I recently spoke to a publicly listed company with a multi-billion market cap, and a Human Resources manager admitted to me that they don't do background checks at all.

The issue is not just limited to top executives — it permeates all employment levels. This widespread nature of fraudulent behaviour raises significant concerns about the integrity of professional environments in Singapore. It suggests a systemic failure.

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What measures do you believe companies should implement to ensure more transparency and accuracy in the credentials of their top executives?

Conducting background checks is a crucial practice that extends beyond top executives. Companies need to safeguard various aspects of their organisation. The rationale for why companies conduct thorough background checks encompasses several key reasons:

Workforce Safety

Hiring someone with a violent criminal history, such as a former sexual offender, can pose a significant risk, especially in scenarios where female employees work overtime or are often alone in the office. Similarly, a former arsonist surely shouldn’t be allowed anywhere near combustible materials in the workplace. 

Data Protection

Employees often have access to sensitive and proprietary data. Without proper background checks, companies risk hiring individuals who might steal or leak this information to competitors, which can have devastating consequences for the business. 

Cost Management

Verifying claims about previous salaries can prevent overpayment and help manage employee costs more effectively. It ensures that salary decisions are based on accurate and fair information.

Overall Integrity and Accountability

Background checks go beyond mere transparency. They are about ensuring the overall integrity of the workforce and holding individuals accountable for their claims and actions. This includes verifying the authenticity of credentials and past experiences.

Technological advancements have made it easier for individuals to fabricate and forge credentials. However, these same technological tools also enable companies to conduct more thorough and efficient background checks.

To address this, companies should implement a basic level of checks, which include:

• CV Check to verify the integrity of the information provided and to see if the candidate has a history of lying.
• Past Employment History Verification checks for inflated titles or exaggerated salary claims.
• Education and Qualifications Verification ensures the candidate possesses the appropriate credentials for the job and additional integrity checks.
• Criminal Checks to assess any potential legal risks.
• Reference Checks can be used to gain insights from previous employers or professional contacts.
• Adverse Media Checks identify any potentially damaging or risky public information associated with the candidate.
• Sanctions and Political Exposure Checks are significant for candidates with known political connections, as this can have severe implications for the business.
• Conflict of Interest Check identifies if a candidate owns a competing business, which could be a significant conflict of interest.

I understand that some Human Resources departments worry about cost, but these days, technology has brought it down significantly. At Veremark, the average background check we do ranges from $100 to $300 at most, which doesn’t even come close to 0.5 per cent of the annual median wages that Singaporeans are being paid. 

How does your firm handle situations where discrepancies or misrepresentations in a candidate's background are discovered after they have been hired, especially in high-profile positions?

We first re-investigate to make sure that our findings are accurate and validate that the negative findings indeed belong to the candidate and are not a case of mixed identity (which is a big problem in the USA as innocent people fail to land jobs simply because they share the same name as a convict). 

Then, we inform our client and will recommend recourse actions accordingly. Their next move usually boils down to their risk thresholds, and some of our clients then seek legal advice on how to handle it.

I've seen clients proceeding to hire potential employees even when our findings reveal that their candidate was a former inmate, for instance, because they support the Yellow Ribbon Project initiative and wish to offer job-seekers a second chance. Others with a stricter company policy of hiring anyone with a former record will dismiss the candidate instead.

In light of this scandal, what would you recommend the current Board of Directors do now to ensure this doesn't happen to the companies they sit on? 

Enforce a strict policy of background checks in each of their companies. And don't just do it for the C-suite; it should be fairly applied to every single employee who comes through your doors and gets access to your company's data and trade secrets.