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Hiring Scandal - How corrupt recruiters are cheating jobseekers, colleges and IT companies
09/14/2012 / 6:20 am #-24
Since we had been recruited by ABC (Achievers Business Corporate) we did not apply anywhere else. We waited till September, only to realise that we could no longer find the company: Aneesh Nirguna (right) student
The hide and seek with Neeraj Garg would be comical, if it were not so tragic.
He comes well-recommended on LinkedIn, the professional networking website, which has 214 others bearing the same name. But the one we seek is hiding behind his old identity of a placement and training executive with Computer Sciences Corporation (CSC).
C.B. Prusty, Avneet S. and Vivek Singh, all former colleagues of Garg's at CSC, once described him as "hardworking and knowledgeable", "one of the few resources the organisation is proud to have", and "a thorough professional and a wonderful human being".
They no longer want to talk about him, and qualify their recommendations by saying they were true at the time they were made, in 2008 and 2009.
One of Garg's friends, approached by BT, promised to organise a chat with him. Within moments Garg had checked out the BT correspondent's profile on LinkedIn. However, he did not accept a 'friend' request, did not call, and nor did he get in touch in any other way.
Podcast: BT exposes corrupt recruiters
Chances are, he wouldn't. In October last year, CSC, a multinational corporation that employs 24,000 in India, forced Garg to resign. The story goes that he was caught negotiating a bribe from a college. Six people with knowledge of the incident accuse Garg of also engaging middlemen to conduct campus recruitment drives, in violation of company policy.
"A hidden camera was used to pin him down," says a former CSC employee. Ernst & Young (E&Y), he says, has been engaged by CSC to investigate the matter.
CSC refuses to comment on former employees. "In this particular case, we can tell you that the individual concerned in your query is not employed with us anymore," says an e-mail from Neelam Gill Malhotra, Vice President of Human Resources (HR).
E&Y would not confirm its role in the CSC investigation, citing client confidentiality.
However, Arpinder Singh, Partner and National Director of Fraud Investigation and Dispute Services, says he has investigated eight to nine cases of recruitment-related corruption at different companies in the country in the last two years.
Amid all this, Garg's side of the story is lost. He did not respond to two e-mails sent to his Yahoo! address. The mobile phone connection he used while at CSC was taken away by the company. It has been impossible to get through to his current number, given to BT by the head of a fledgling university, which Garg ostensibly visited after leaving CSC to solicit business. Numerous calls to this number from Bangalore and Delhi either elicited no response or were rejected.
After being unsuccessful in reaching out to Wipro directly in spite of all efforts, I had to explore the middleman route. Somebody told me we had to go through a consultant: Mukti Mishra
This is just one of the worms crawling out of the information technology industry's recruitment can that has been prised open by one scandal after another.
Vijayawada in Andhra Pradesh, where engineering colleges compete with mango orchards for dominating the landscape, still has echoes of a story about a high-flying recruiter from Wipro Technologies: Russell Purushothaman. Placement officers in Nunna village, a half-an-hour drive from the city and home to no less than five engineering colleges, drop their voices to a whisper when you mention Purushothaman.
A few years ago, Purushothaman was quite the messiah. Newspaper archives have him hiring more students than any other recruiter and offering higher salaries, until he suddenly vanished in a haze of rumour.
According to a former colleague, he was "street-smart - the kind you would expect in sales". Here, however, he allegedly sold jobs, charging up to Rs 7.5 lakh to visit a college and Rs 50,000 for each offer letter.
His game was up when a colleague blew the whistle after he saw a newspaper advertisement put out by a college. It had photos of students selected by Wipro. One of those was a girl whom the whistle-blower had rejected. As more skeletons tumbled out, the bosses at Wipro summoned Purushothaman to Bangalore and interrogated him for six hours before agreeing on a not-so-graceful exit. For good measure, the company filed a case of cheating at the Madhapur police station in Hyderabad. The matter is sub judice.
Police officers confirm that Wipro has indeed filed the case against Purushothaman, though nobody wants to be "dragged into the matter". One of the officers merely read out some details from the report filed with the Madhapur station and gave the FIR number, which corresponds to the case number given by officials in the court of the IX Metropolitan Magistrate, Cyberabad, where the case has been filed. Court officials initially agreed to give BT a certified copy of the case documents if an application was made through a lawyer, but later grew cold feet.
Purushothaman is harder to trace than Garg. LinkedIn shows him as working with an information technology company called Datamatics Consultants Inc - Asia. This company has no website or contact number. Its logo, just like its name, resembles that of Mumbai-based publicly-listed company Datamatics. A spokesperson for Datamatics says it has nothing to do with Datamatics Consultants Inc - Asia.
Wipro is being coy. When BT broached the subject in an e-mail, Subhashini Pattabhiraman, part of the company's media relations team, responded with details of the measures taken to avoid recruitment fraud, efforts to create public awareness, and strategy to prevent other possible areas of HR corruption. Not one of the 603 words in the document reads either Russell or Purushothaman. When BT persisted, and sent another e-mail to Vipin Nair, head of communications, all it elicited was "no comments" and "regards".
Incidentally, the case was called in the court of the IX Metropolitan Magistrate on August 9, the day this article was finalised, and posted for hearing on October 8 this year.
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Typically, the colleges that succumb to the charms of dodgy recruiters and placement consultants are those that are not accredited and are located in areas which see little traffic of reputed recruiters. They face the classical chickenand-egg situation. They need recruiters to attract students and students will come only if recruiters do. In come the facilitators - middlemen, corrupt employees, college authorities who are willing bribe-givers - who embolden the colleges to declare to the world "100 per cent placement" and guaranteed salaries.
This at a time when research reports say only a handful of those passing out of professional colleges are employable straightaway. A recent study by testing and assessment company MeritTrac says recruiting companies found only 21 per cent employable MBAs out of 2,264 from 100 schools outside the top 25. According to Aspiring Minds, another assessment company, less than 17.5 per cent of engineering graduates can be employed in the IT sector.
In this scenario, any claims of "100 per cent" should be taken with a generous serving of salt, but try telling that to an eager parent, who sees an MBA or an engineering degree for her child as a ticket to untold riches. The middlemen are happy. Colleges pay for their travel, stay, and other needs. In one case, a recruiter blew Rs 25,000 on foreign liquor in a small town hotel in a single night. And colleges get their bragging rights. But the students fall in the gutter that lies in between.
That number in the gutter runs into thousands every year, say HR professionals. And it is difficult to even fix the blame for it.
Illegal and immoral practices actually go way deeper. There are junkets on offer for placement officers to Dubai, Colombo and Bangkok. Colleges give kickbacks: Subroto Bagchi
"I face pressure from parents," says Sai Krishna Kota, Training and Placement Officer with Prasad V. Potluri Siddhartha Institute of Technology in Vijayawada. "They ask why certain companies are not visiting my college when they are going to the neighbouring ones. 'Give them money, get the company at any cost,' they say."
The pressure from parents, say colleges, started unethical conduct in recruitment. The parents made HR professionals corrupt, not the other way round. However, colleges, for their part, are eager to cater to the parents and more than eager to pay bribes if these help in placements.
More than 15 placement officers of rural engineering colleges from Andhra Pradesh, Tamil Nadu, Karnataka, Maharashtra, Uttar Pradesh and Chhattisgarh told BT that their placements in a good year ranged between 20 and 60 per cent. Rural colleges, particularly those that have come up in the last five or six years, struggle to get topflight companies - the big recruiters - to their campuses. They bribe HR personnel, seek the help of middlemen, and end up inviting bogus companies.
"After being unsuccessful in reaching out to Wipro directly in spite of all efforts, I had to explore the middle-man route. Somebody told me we had to go through a consultant," says Mukti Mishra, Co-founder of Centurion University of Technology and Management, which runs colleges in one of India's poorest districts, Gajapati in Orissa.
The middleman, engaged late last year, has thus far failed to get Wipro, or any other company in that league, to Centurion. Wipro, which has tightened its HR processes after the Purushothaman episode, doesn't approach colleges through a third party.
Colleges have to be accredited, or empanelled, by toptier companies before they come to recruit. The process involves a physical inspection in which the college's infrastructure and faculty, among other things, are evaluated.
But middlemen still fancy their chances. "I might use my good offices to recommend a college," says Visakhapatnam-based Vamsi Kiran, whose name somehow became associated with HCL Technologies. He runs a training organisation but says colleges often "request" him to help in placements.
In June HCL Tech got worried enough to send an e-mail to a university clarifying its position. "In the recent past we have found that a certain individual named Vamsi has been misrepresenting HCL and our intent… he or any other individual does not represent HCL for our talent acquisition needs," said the e-mail from Puneet Kumar Pandey, Director, Human Capital Management. The company also told other colleges it had nothing to do with Vamsi. A memorandum of understanding between a rural college and a Bangalore-based middleman - neither can be named because the middleman has threatened the college with consequences, and, curiously, also hinted at suicide - is revealing. Under "financials", the agreement says the college will pay Rs 10 lakh as capital advance to initiate accreditation with Wipro and TCS.
When this was pointed out to TCS, the company said it "has never heard about a person like him nor has it engaged his organisation to work, canvass, engage on behalf of TCS at any point of time for any work". Wipro said it had nothing to do with this middleman, who, incidentally, claims to have placed at least 30,000 graduates over the last decade.
For colleges, it is not that easy to dismiss the middleman phenomenon. They in fact are forced to foster it. Nothing moves without money or gifts, say placement officers. When HR teams of companies visit remote campuses, colleges pay for their tickets and stay.
When offers are doled out, they express their appreciation through gifts like mobile phones, tablets, and even gold. All this in the hope that they will come back next year and hire in larger numbers. In September last year, midtier IT company MindTree recruited from a college in Tirupati.
My team and I created the Talent Quality Group at Wipro. The group can also do retrospective inquiryâ€“dig into the records of employees who are not fresh and check their previous employment details: Pradeep Bahirwani
In May this year, when two HR executives visited the same college on an employee engagement trip, each was "forced" to accept a gold bracelet worth Rs 75,000. They declared the gifts when they got back to the headquarters and the bracelets were sent back.
"We are investigating the matter very seriously," says MindTree Chairman Subroto Bagchi. "I believe this incident is nothing compared to what is happening all over the country and the illegal and immoral practices actually go way deeper. There are junkets on offer for placement officers to Dubai, Colombo and Bangkok. Colleges give kickbacks for coming to their campus for hiring and commission to intermediaries who bring students for engineering admission. I have personally decided to take the matter head on. We simply cannot tolerate what is going on."
What is going on goes beyond demands for "end-to-end hospitality" by HR executives. It includes fakes: fake offer letters and fake companies. o understand the fake phenomenon we need to go back to the engineering college cluster in Vijayawada. About a 100 km from the city is Khammam. On a 35-acre plot here, new blocks are being added to a six-year-old college, Sarada Institute of Technology and Science. The principal's office, in the college's main block, is a huge rectangular room. At one end of the room is a desk laden with a PC, printer, newspapers, a book on thermodynamics, a dictionary and a tray full of resumes.
The Principal, K.V. Narasimha Rao, sits right under a large, black and white portrait of Albert Einstein. Rao is sifting through resumes, looking to fill a placement officer's position. He has been meeting and rejecting candidates, most of whom only talk of paying bribes to get students placed.
"They tell the college management that companies ask for bribes. When funds are made available, the placement officers can pocket some of the money," he says, peering from behind his rimmed glasses.
The pressure to meet the "100 per cent placement" target - much crowed about in advertisements these days - forces placement officers to invite all kinds of companies. The result has been disastrous. Fake companies that operate only for a year or so have been cropping up over the last three years. They start recruiting students starting August-September, collect money either from the college or from the students directly, citing training expenses or a refundable security deposit, and vanish by May of the next year.
Try to Google the website of Achievers Business Corporate (ABC), which was hiring till the other day. Even the omniscient search engine comes up short. The few places on the Internet where you do find ABC mentioned, you would also find incensed comments from people alleging that the company was "fake" and had disappeared after making offers. Some say they had sent Rs 5,000 along with their documents to "confirm" their jobs, but later found the company's premises locked, phone numbers disconnected and emails bouncing.
ABC, which called itself Indore-based, offered jobs to as many as 20 students of Ballari Institute of Technology and Management (BITM), in Bellary, Karnataka. "ABC came to recruit electronics graduates saying it had projects in the telecom sector.
It had a community on Facebook," says Aneesh Nirguna, one of the 20 'recruits'. The offer letters were issued on March 30 last year and the 'recruits' were asked to join in September. "We had to furnish a demand draft of Rs 5,000 as security deposit. Since we had been recruited by ABC we did not apply anywhere else. We waited till September, only to realise that we could no longer find the company," says Nirguna.
A BITM trustee, who did not want to be named, says the management never quite trusted ABC but the students pressured it into inviting the company. "ABC was recruiting in the neighbouring colleges and the students asked us why we were letting the opportunity pass. These were students who had not been placed until March last year and had 40 to 50 per cent marks."
Kumar Gorasa and K. Ram Kishore paid Rs 50,000 and Rs 1 lakh, respectively, to Prodigy Solutions, which called itself an IT company and collected the money as a precondition to joining. There are many companies in the world which call themselves "Prodigy Solutions", but the one in this case was housed on the sixth and ninth floors of Cyber Towers in Hyderabad, a landmark address for the IT industry. According to police officers, the company collected Rs 4.15 crore from 660-odd recruited employees before it vanished: lock, stock and CEO.
A company that called itself March-End Consultancy approached 20 to 30 colleges in Andhra Pradesh last year and charged Rs 8,000 to Rs 15,000 for every offer issued on behalf of IBM and MphasiS. The letters turned out to be fake. "The company recruited 140 students from my college in February last year and took Rs 500 from each as registration fee. They identified themselves as recruiting vendors for IBM. Three persons the company brought along impersonated IBM executives.
They carried IBM business and identity cards. The college also received an e-mail from a fake IBM domain," says V.S. Rama Krishna, Placement Officer at BVC Engineering College, Odalarevu.
An IBM spokesperson said the matter was under investigation and the company was assisting the authorities. MphasiS at first did not respond to BT's queries. When reminded, a spokesperson for the company sent an SMS with a smiley, saying: "No update …asked around. Looks like it is far too dated to scoop out dope now."
Pune-based Persistent Systems discovered in November last year that a company called Orange Software Technology, based in Hyderabad, was hiring on its behalf - and, of course, charging the candidates money. A legal notice, says Persistent's Chief People Officer Sameer Bendre, put an end to it.
TCS, which hires more every year than any other private company in the country, is a perennial favourite with fraudsters and has taken out advertisements in newspapers asking colleges and students to be careful. Fellow IT giants IBM and Wipro have done the same.
Public awareness campaigns, though necessary, may not be sufficient. Placement officers will need to do more due diligence, and, eventually, structural changes alone may address the malaise.
Many suggest a single cross-industry test which doesn't exclude any student from any college, however remote. Companies can pick students on the basis of their score. Well-organised pooled campuses - in which students from many colleges gather at a common venue to write a company's test - could also help.
"The issues around corruption have recently been brought to our notice. I have discussed them with our Executive Council and with HR executives at our HR summit in Chennai two weeks back. We all need to review our processes. I am sure the industry will take the necessary steps," says Som Mittal, who heads NASSCOM, the industry lobby for IT, the largest recruiter at colleges and in whose name the most fraud happens.
There are lessons to be learned from Wipro, which has tightened its HR processes. "My team and I created the Talent Quality Group at Wipro. The group can also do retrospective inquiry - dig into the records of employees who are not fresh and check their previous employment details. Wipro has since then received a patent for some of the innovative recruitment processes that the group put in place," says Pradeep Bahirwani, former vice president of Talent Acquisition, who has left the company to write fiction.
He may be able to churn out a real thriller writing facts.
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