Phenom Unveils the HR Tech Industry’s First Fraud Detection Agentic AI Tool

Imposters posing as qualified job applicants is so pervasive it’s difficult to know for sure how deep the problem runs. Gartner predicts that by 2028, one in four global job candidates could be gaming the system, but even that may well underestimate just how bad it is.

Earlier this year, the U.S. Justice Department indicted several North Korean nationals in connection with a years-long plot to install North Korean IT workers as remote employees. More than 100 American companies fell for the scheme, which generated almost $7 million for the overseas IT workers.

This is precisely why we built the Phenom Fraud Detection Agent — the industry's first comprehensive AI solution capable of detecting resume fabrication, AI-assisted answers, and imposter candidates in real time. The breakthrough technology maintains hiring velocity while eliminating costly mis-hires, mitigates security risks, and protects brand reputation from increasingly sophisticated fraud schemes targeting remote and hybrid recruitment processes — all while keeping humans in the loop to make final decisions.

Is candidate fraud really a problem? 

Phenom has more than 700 customers on its platform, and they include multinational conglomerates and universities. In the last year, they reported anywhere from a 50%-200% rise in poser candidates. For large employers who may be hiring tens of thousands of IT professionals (the chicanery almost always involves IT roles), fraudsters are counting on scale to simply slip through the cracks — similar to what the indicted North Koreans allegedly did.

If you think about it, it could take anywhere from three months to a year to figure out someone isn’t actually qualified, especially remote workers. At this point, an organization could have lost tens of thousands of dollars in “salary” payments. 

“Organizations need to address the surge in sophisticated hiring fraud, particularly in industries where workers handle highly sensitive information or organizations that depend on remote work. Our Fraud Detection Agent is the answer. It goes beyond detecting resume embellishments, flagging AI-generated responses during interviews and identity switching throughout the hiring process.”

— Kumar Ananthanarayana, VP & GM, Product Management, Phenom

The benefits of Phenom Fraud Detection Agent

Phenom's Fraud Detection Agent integrates seamlessly with Phenom Interview Intelligence, analyzing candidate responses in real-time during video interviews. The agent identifies multiple fraud indicators, including:

• Identity and Location Verification — using facial recognition and voice matching technology, the agent ensures the same individual appears for video screenings, phone interviews, and final interviews, preventing imposter candidates from infiltrating the hiring process

• AI-Generated Response Detection — flagging answers that exhibit characteristics of large language model (LLM) usage, including unnatural pauses, overly formal language patterns, and structured responses that deviate from authentic human speech, suggesting questions on the fly to gather authentic candidate responses

• Multi-modal Deployment — cross-referencing information from different media (e.g., resume, portfolio) submitted during the interview process to provide a holistic view of potential fraud

The agent works across all interview formats. During live interviews, advanced AI tools analyze responses in real time and alert the interviewer if there's potential that ChatGPT or other commercially available LLMs are being used to answer questions, providing recommendations for additional questions to gather authentic responses. For recorded interviews, the tool provides assessment highlights where candidates really spoke to job requirements while also identifying potential bias or legal issues based on questions asked. The system can also compare video and audio screening results to ensure the same person who completed initial screenings is participating in subsequent interviews.

Beyond real-time detection, the Fraud Detection Agent provides detailed post-interview evaluations that compile fraud indicators across the entire candidate journey. Recruiters and hiring managers receive comprehensive reports highlighting potential integrity warnings, allowing for informed decision-making while maintaining human oversight in all final determinations.

Watch the complete Product Innovation Keynote here.

What’s next in fraud protection?

The next iteration of our products will allow employers to identify whether resumes were generated based on actual work experience, or whether they were strategically enhanced by AI to get the job. True, most people tweak resumes to meet the requirements of the job anyway. It’s a long-held practice. But Phenom wants to ensure that that experience is in fact real, and not made up to make the candidate look more appealing.

AI helps both employers and candidates

Using AI to hire talent isn’t just for employers. Candidates can benefit too, and Phenom is there for them. Phenom Candidate Concierge, a feature of our Talent Companion, allows prospects to prepare for interviews. So it's not all or nothing. It’s just that when it comes time for candidates to be themselves, they’ve got to be their true selves in every respect.

As with most things in life, if something sounds too good to be true (like a job candidate), it probably is. Caveat emptor!

Register for AI Day for additional information on our Fraud Detection Agent