How to Verify Reputation

With the development of KYC, liveness, and related technologies, almost any company can now verify a person’s identity. However, it’s still a struggle to properly verify one’s reputation. And, if a bad—or outright fake—reputation goes unnoticed, companies can unknowingly hire unqualified employees, expose themselves to fraud, or even face intellectual property theft.

Companies also face risks related to their own reputations. For instance, ruinous accusations of criminal activity can be baselessly levied against them. And while the accused business may successfully fight off such accusations in court, the reputational damage can still be permanent.

Once a reputation is destroyed, it can be difficult to rehabilitate. So the problem here is two-fold: on the one hand, reputations are highly fragile; on the other, they’re difficult to verify. This combination creates problems for companies and opportunities for scammers.
Below we’re going to go through a list of commonly used methods for verification of reputation. Needless to say, some are more reliable than others.

Less reliable verification methods

There are many ways to check one’s reputation. And while each has its downsides, we can separate them into two categories: “less reliable” and “more reliable.” 

The less reliable verification methods below highly depend on a person’s claims and don’t have any official form of verification. Let’s get into the details. 

Recommendation letter

For centuries, the most basic way to confirm one’s reputation has been requesting a recommendation letter from a trusted source. In the Three Musketeers, d’Artagnan uses a letter of introduction written by his father to Monsieur de Treville to prove his worthiness and join the Musketeers. Today, it’s not much different; people now request recommendation letters from their former employers or professors to prove their reputation.

Downsides of the recommendation letter

Despite being used for many years, recommendation letters are highly unreliable, as there’s no clear-cut way to consistently verify them. Basically, anyone can write a recommendation letter and claim it to be written by someone else. For instance, in Quentin Tarantino’s The Hateful Eight (2015), Warren, played by Samuel L. Jackson, shows a personal letter written to him by Abraham Lincoln. Later on, Warren confesses that the letter is fake and he simply used it as a survival tool in the face of extreme racism. Even though this is an example of forged letters being used for good, this same technique can also be used by unscrupulous actors for far less noble causes.

LinkedIn reputation

Many job seekers now understand that potential employers may look them up on LinkedIn. Knowing this, they can either delete controversial information or change their privacy settings. But they can also intentionally create a certain image of themselves using false information. 

Downsides of LinkedIn

Say, someone wants to make it look like they went to Harvard (even though they didn’t): they can just add other Harvard alumni to their LinkedIn, join certain Harvard-related groups and post about the university. This could be enough for a potential employer to take the bait.

Take, for example, Ali Ayad. He’s an influencer, entrepreneur, former designer at Nike, CEO of Madbird, and a person who’s never existed. 

In 2020, during the economic fallout of the pandemic, someone created a fake personality known as “Ali Ayad”. He founded a fake design company called Madbird and hired people to use as free labor. Ali Ayad was abusing the fact that nobody could verify his or his company’s reputation. Plus, Madbird had a website that seemed legitimate. 

He’d deceive his “employees” by inviting them to Zoom meetings with more than 40 other “team members”, most of whom turned out to be fake. Ali Ayad himself was praised on LinkedIn by fake accounts pretending to be his former colleagues and managers from his fake job at Nike.

While the Ali Ayad saga is a pretty extreme example, there are plenty of other instances where people invent their pasts to make a certain impression. So even if a person isn’t trying to outright fake their alma mater or work experience, they’ll still probably sprinkle in a little extra credentials on LinkedIn to paint a more flattering picture of themselves. 

More reliable verification methods

So far we’ve discussed the aspects of reputation that people can create for themselves. Now, let’s discuss the kind of reputation based on the traces people leave after themselves. These methods are based on an extensive amount of data collected either by financial institutions or companies specializing on collecting open source information. Unlike letters of recommendation and LinkedIn profiles, these methods can be independently verifiable. 

Credit scores

 A credit score is a number that represents a person’s financial trustworthiness.

The US credit scoring system is the most well-known one, calculating credit scores for individuals based on records from banks, credit card companies, and other lenders. 

To put it simply, the better a person’s score is, the better the conditions of their credit will be. These scores are especially important for lenders, as they’re used to decide whether to lend to an individual and how much interest to charge. 

So, if a person doesn’t pay their bills on time, their credit score drops. At the same time, if a person has made timely credit card payments for many years, they’ll have a higher credit score—and therefore a better reputation with the bank. 

Downsides of credit scores

Well, the problem is that three companies—Equifax, Transunion, and Experian—essentially control credit scores in the US. Obviously, people can dispute the credit reports these companies make about them, but sometimes a person may not know all the details behind their evaluation. For example, in 2017, the Consumer Financial Protection Bureau reported that the credit reports sent to loan seekers by Equifax and Transunion differed from the ones they sent to the lenders. As a result, people were deceived into thinking they had a better score than they actually had.

OSINT

Open Source Intelligence (OSINT) refers to collecting and analyzing information from open sources. Originally, OSINT was used by the US during the Cold War to learn about life behind the iron curtain without the use of spies. At that time, OSINT specialists mostly used radio broadcasts and newspapers as their main source of information. With the development of the internet, OSINT expanded to a variety of websites, scripts, and procedures that allow industry specialists to collect huge amounts of data.

Today, OSINT is still used by governmental agencies and a variety of businesses. Certain companies, such as Bellingcat, use OSINT to track political events, while other companies can use it to ensure that their clients are trustworthy. This is done by analyzing the traces people leave behind on the internet—because once a person posts something online, it’ll stay there forever. 

If a person wants to fool an OSINT specialist about their degree, it will take much more effort than just claiming so on LinkedIn and adding several people from a certain university. After all, information about any person can be found from open sources, so it’s just the question of how deep an OSINT specialist will dig in search of the truth. 

Downsides of OSINT

Does it mean that OSINT is the perfect way to learn about someone’s reputation? Well, not exactly. There are many downsides to this approach. 

The problem with OSINT is that barely anyone can make conclusions about a person’s trustworthiness based on information from open sources, as most of it is unrelated, ordinary data. And that’s when a true OSINT specialist can step in and find patterns in these facts. An OSINT specialist is a bit like Sherlock Holmes, essentially.

Plus, there are ways to fly under the radar of an OSINT specialist. For instance, if a person has recently changed their place of residence, this information will be unavailable to an OSINT specialist until it reaches any of the open sources. This can be used by people who want to fool companies or, in certain cases, the government, about their place of residence. A person can simply post photos from their old place for many months while still living somewhere else. 

The importance of reputation

Reputation is an asset. But not one you can simply purchase with money. As Warren Buffet puts it, “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.” 

We can see how this quote comes to life with cases of A-list celebrities, such as Kevin Spacey and his sexual assault scandal. Once a person tarnishes their reputation, people come to see them as toxic, and having any form of partnership with them also becomes toxic. And while not all of us are famous US actors, we can see that, in our increasingly digital world, any damage to the reputation becomes easily Googleable. 

The future of reputation

So, what will become of reputation in the future? Will we keep relying on the qualities a person claims to have on their LinkedIn profile or will we pay credit report companies even more to learn about a person’s trustworthiness?

Well, Vitalik Buterin, the co-founder of Ethereum, is currently working on a new form of reputation building. In May, Vitalik announced that he wants to develop so-called “soulbound tokens”, which are essentially NFTs that a person can earn after achieving something. 

For example, if a person graduates from a university, they can get a soulbound token proving that they actually hold a degree from this place. Similar principles will apply to attending master classes or working at companies. As Buterin himself calls it, soulbound tokens are sort of an extended resume. However, unlike the CVs and LinkedIn profiles, which anyone can fake, soulbound tokens need to be verified by a person or organization that provided it.

With this approach, we may shift from a reputation with no proof or reputation based on a company’s opinion to a reputation created by other people. There’s an episode of Black Mirror (2011-2019) where people rate each other’s transactions. In the episode, people feared tarnishing their reputation, and therefore access to certain services. This resulted in a society, unable to express its feelings. Luckily, Buterin’s concept isn’t as dystopian as the one in Black Mirror.

Still it raises many sobering questions. If we were to live in the world with soul-bound tokens, would we continue believing people’s LinkedIns without giving it a second thought? Or would we only believe what tokens tell us? The bigger question is: should we even have to prove our reputations in the first place? 

Perhaps the safest way to size up a person’s character will be in real life, face to face.

If you want to learn more about reputation and how it can be verified, check our YouTube video below.