[AltoLXI]

Also in the news.

Tata Consultancy Services (TCS), one of the biggest IT firms in India, has been rocked by a bribes-for-jobs scandal. According to a report by Mint, a few senior personnel at the company were accepting bribes from staffing firms for giving jobs to their candidates, for years.

Link

[SnS_12]

HR officials making 100 crores in bribes at TCS..

Tata Consultancy Services has sacked at least four executives for allegedly giving preferential treatment to certain staffing firms in recruiting contractual employees, people aware of the development said.

A media report earlier in the day said TCS sacked four executives for allegedly accepting commissions from staffing firms and that the executives could have racked up to Rs 100 crore in commissions.

https://m.economictimes.com/tech/inf.../101221755.cms

[Aditya]

TCS reports bribes-for-job racket worth ₹100 crores - Post moved to a new thread.

[hdus001]

Wow! I worked with one of the 4 accused, about 20 years back.

[subraiyr]

Originally Posted by SnS_12

HR officials making 100 crores in bribes at TCS..



https://m.economictimes.com/tech/inf.../101221755.cms

This is nothing new and it's not restricted to TCS. There are multiple tech giants that are in cahoots with staffing and recruitment firms. The model is very simple, I as a firm will give you a contract for a certain sum of which you kick back a % to me as an individual. You build your revenue and i build my new house

So much for all the ethics and compliance training, we all go through in our firms

[ranjith_cbz]

This is nothing new and neither will stop happening in future. 'HR officials and Hiring Managers' receiving kickbacks is one of the most common scams in IT industry since the times of 'Satyam' days. I would rather go to the extent and say that it's sort of agreed/understood practice for some.

Another much more common scam is procurement and vendor management teams having a markup on all things a corporate procures so much so that they will have a cut even in the event manager's fee for their annual year end events/retreats. Nothing is left for chance.

Unfortunately these two ways are also through which sometimes few unethical/fraudulent founders of a funded startups easily take out(steal) money for themselves.

[Samurai]

Originally Posted by ranjith_cbz

Unfortunately these two ways are also through which sometimes few unethical/fraudulent founders of a funded startups easily take out(steal) money for themselves.

Aren't VCs keeping a close eye on it? These days VCs rarely pay upfront. They assign a virtual CFO who approve all the salaries, POs and invoices.

[Arun_S]

Originally Posted by ranjith_cbz

Another much more common scam is procurement and vendor management teams having a markup on all things a corporate procures so much so that they will have a cut even in the event manager's fee for their annual year end events/retreats. Nothing is left for chance.

Pretty true, these guys support vendor management\transport company people so much that you feel they are in their payroll instead of IT Company's Payroll.

[Bala02]

Any organization which deals with a large work force will have gray areas around two departments, namely recruitment and facilities admin. Though management try and regulate, these kind of instances keeps cropping up due to human greed and abundance of opportunities to receive kickbacks by unethical means. These people will also be constantly tempted by their vendors. I have heard many people in senior management mention in a funny way that the admin people actually make almost what a VP makes that too mostly Tax free!

[ranjith_cbz]

Originally Posted by Samurai

Aren't VCs keeping a close eye on it? These days VCs rarely pay upfront. They assign a virtual CFO who approve all the salaries, POs and invoices.

VCs are in the business of investing in startups based on the 'Hit Rate' theory i,e. they assume that even if 1-2 out of 10 of their invested companies succeed and go through a successful IPO debut they will recoup all their investments by multiple X. They accept that they have to write off majority of their investments but that odd 1 or 2 will hit BIG. Case in point, see all the recent news of frauds/scams happening in many funded startups which were backed by marquee investors and the respective investments more or less written off.

VCs are investing in the idea, founding team and associated market potential. Many successful VC firms believe in a hands off approach when it comes to founders running their invested businesses and fully trusting and backing their founders to be qualified, capable and committed to 'doing the right thing'. VCs are more bothered about disruption, top line growth, market expansion and technology/innovation. Viability, profitability, compliance and operational efficiencies are mostly an after thought though this is changing in the recent times as funding is dried out and businesses have to turn profit after certain period of time.

Of course there would be an appointed CFO and external audits etc but startups excel in disrupting the status quo, agility and pace at which they react to market insights. You don't want to slow this down with VC appointed bureaucracy layers and external oversights etc. If a startup founder has to run every spending decision small or big through them then there is not much difference left between established corporations and startups.

A lot hinges on professionalism, ethics and integrity of a founder/promoter of a startup or a listed company that such frauds/scams doesn't happen when they are at helm. If they are honest then no one is required to guide them to do the right thing and if they choose to play naughty then no amount of CFOs, oversight or regulatory bodies can stop them from cheating or siphoning off of the companies resources.

[am1m]

Family members who work in HR have been telling me about the recruitment and facilities scams they've seen for decades now. In fact, kudos to TCS for actually taking some action- in the majority of cases, especially in smaller companies, nothing happens.

I've already posted before about my brush with these scams when trying to hire for my team at one company and HR was pushing totally unsuitable candidates from one particular recruitment firm, ignoring the much better suited candidates through employee referrals, and how they subtly tried to pressure me into going with what they wanted. I've also seen one whistleblower getting fired for trying to report some discrepancies.

Depressing, IT was supposed to be a different sort of industry as far as corruption goes. And how interesting that the same type of higher execs like to cite employee fraud as a reason to completely scrap things like remote work. Now what will they do after unearthing recruitment scams? Stop recruitment? Or stop using recruiting agencies?

[Gaur]

Nothing surprising here, its making news just because the figure is 100cr.
its kind of a known practice all over, have seen people being paid in cash or in-kind.

Nothing is going to stop, may become just a bit more discrete.

[chandrda]

This has not come as a surprise to many who had knowledge of how the recruitment was working for last few years. The RMG Global Head, E S Chakravarthy, I hear has not grown in the organization on talent and ability. Its more of a blessing he received for being loyal to certain group.

I have heard from TCS project managers that in a team of 100, there are around 90 employee who have experience of below 2 years and have hardly any knowledge of coding, technology and some can't even speak English. These resources were forced up the project managers by the HR and many project teams are struggling to deliver.

I think the HR Team has scarified a decade of growth and stability for TCS by this scam.

Regards

[aqualeo2040]

Originally Posted by chandrda

I have heard from TCS project managers that in a team of 100, there are around 90 employee who have experience of below 2 years and have hardly any knowledge of coding, technology and some can't even speak English. These resources were forced up the project managers by the HR and many project teams are struggling to deliver.

While the fact remains that not only TCS, but all IT MNCs indulge in such activities around recruiting, let us not slander a organization based on hearsay.
In the race to lower the LCR (Loaded Cost Rate), ALL and I mean ALL MNCs are forced to keep a skewed pyramid. However, 90% is a massive exaggeration.

The project staffing problem is different from the recruitment issues being flagged here and I think deserves a different thread.

I recall my personal experience from my stint in another of the world's largest MNCs. HR would send almost 10 mails a month around Employee Referrals for hiring with a sizable bonus amount. However, no matter how many resumes you upload on the portal, they get rejected by the 3rd party screening team on some pretext or other.
It was only once I managed to chase the trail and caught them trying to reject on a flimsy clause and got the person hired. However, that is an exception rather than practice.
The general pattern was that the same resume submitted by a hiring agency gets selected for interview while that submitted by an employee/non profitable sources get rejected.
I still don't know if anyone pocketed the promised referral bonus.
The only silver lining in the entire process was that the influence of the hiring team ended till that point and we could and did reject profiles during technical interviews.
However, a few rotten apples would get thru once in a while and some of them got pruned during the BGC process as well and others during the Performance appraisals.

[sanjayrozario]

Originally Posted by ranjith_cbz

Another much more common scam is procurement and vendor management teams having a markup on all things a corporate procures so much so that they will have a cut even in the event manager's fee for their annual year end events/retreats. Nothing is left for chance.

There's also a type of scam where there's an understanding that for every major IT procurement, the CTO/CIO, etc. gets an award so that they can display it on LinkedIn only to further one's career. I know of a person who's the most awarded person on earth (via IT procurement & displayed on LinkedIn) that one's left wondering how is big tech not hiring such a talent