When someone lies on a resumé, it doesn't usually end up as front-page news, as was the case with Scott Thompson, who was forced to resign as CEO of Yahoo for claiming to have a computer science degree that he doesn't have.
Had Yahoo hired a service like BackCheck before hiring Thompson, it might have avoided considerable embarrassment.
"Most people think employers won't check, so what's the harm in having a completely fake resumé?" said BackCheck founder and CEO Dave Dinesen, 42. "What's the worst that can happen? You're not going to go to jail."
BackCheck specializes in criminal record, employment, educational and credit checks, and is used by most of Canada's largest employers, including London Drugs, Telus (TSX:T), Home Depot, Staples and Wal-Mart Canada.
In April, BackCheck merged with Sterling Infosystems, an American company. The newly merged companies now constitute North America's biggest background checking service.
"I had a call probably every two months from either private equity or some company wanting to buy us," Dinesen said. "And we turned those down for years. But we got to a point in the middle of last year where we thought this is the right thing for the business."
Dinesen said human resource managers simply don't have the time or skills to verify every fact on the thousands of resumés they receive, which is why so many people get away with making false claims.
Dinesen's favourite example is the would-be executive that BackCheck was hired to check out.
"He claimed to have an MBA from a prestigious East Coast United States university. He said he was a former vice-president of the Bay, and he said he held the prestigious Order of Toronto. Well, the degree was fake, the Bay had never heard of him and there is no Order of Toronto."
Born and raised in Richmond, Dinesen went to work for London Drugs after graduating high school and spent 12 years there before deciding to get his private investigator's licence.
He became a partner in a local private investigation firm. It was there, in 1997, that he started developing a background check service, after he got a call from Fido asking if his company did employee background checks.
In 2000, Dinesen started his own PI firm and brought his younger brother, Stephen Dinesen, in to work with him. Venture capitalist Dean Drysdale bankrolled the new company, which conducted reference interviews, credit checks and criminal record checks and provided education verification.
"It was a terrible time for private investigation in 2000," Dinesen said. "We did a lot of work for ICBC, and ICBC virtually stopped spending any money on private investigators. There was about a year when they didn't spend any money, and I had to lay off 40 people."
The company grew slowly up until September 11, 2001. But in the wake of the 9-11 terrorist attacks in the U.S., employers in the U.S. and Canada became more concerned about security issues, and business began to pick up.
"We were in the right business, in the right country at the right time in history, with a branded, well-packaged product," Dinesen said.
Initially, every criminal record check required Dinesen to get the consent and identification from the subject of the check and drive down to the Vancouver police station. In 2004, he launched myBackCheck.com – a web-based database for customers to retrieve their own background results – and began attracting Canada's largest employers as clients.
MyBackCheck.com streamlines the criminal record check process and stores the information securely online. The client can grant permission to prospective employers or volunteer organizations to view the background check online.
BackCheck also developed a verification system for Home Depot installers. Customers receive an email with the installer's photo and ID number. When the installer shows up at someone's home to deliver or install a product, the customer can check the installer's photo ID against the electronic verification received earlier.
Those are the kinds of innovations that convinced Sterling Infosystems CEO William Greenblatt to buy the company.
"They have created some very forward-thinking, innovative products that we believe we can bring south of the border and disrupt the status quo in the United States," Greenblatt told Business in Vancouver.
Greenblatt added that he believes Sterling will also benefit from Dinesen's experience and vision.
"He's a great visionary. He can create products, he has great ideas. He thinks so outside the box, and he's a very hands-on operator."
In 2007, BackCheck opened an office in Wales. It also opened offices in Montreal and the Philippines. The company now employs 450 people, 100 of whom work in Surrey. Another 180 work in Montreal.
The company has been highly successful in Canada and the U.K., but not the U.S., where greater competition has made it tougher to crack the market. Last year, Dinesen decided it was time to merge with an American partner, and when he met Greenblatt, he knew he had found his partner.
"It's like I had met my twin from a parallel universe," he said. "There was a cultural fit. There was no doubt in my mind this would be the right deal."
Sterling bought 100% of BackCheck, and Dinesen used his profits to buy into Sterling. Nothing will change with the Canadian operations, said Dinesen, who remains BackCheck's CEO.
"Our entire management team is intact, all our data stays in Canada at the Telus data centre," Dinesen said. "At this time, it's absolutely business as usual." •
