3 Case Studies: Which MBA Admit Failed Background Verification?

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A full decade ago – after several top business schools launched a formal process for reviewing the professional, academic and personal backgrounds of their admitted applicants – at The MBA Exchange we introduced the first service to help individuals facing this stressful process. And continually since then one of the most frequent questions we’re asked is: “Are offers of MBA admission actually rescinded during the background verification process for applicants who have not intentionally misrepresented themselves?”

The answer is “Yes.”

Each year, some admitted candidates are informed by their dream business school that they’ve failed to pass the pre-enrollment screening process. If these individuals had only approached background verification more proactively, thoroughly and strategically, many could have avoided this fate.

Here are three case studies – based on our first-hand experience supporting hundreds of clients’ background verifications – that illustrate common predicaments that raise red flags. One of these admits had his or her offer rescinded, not necessarily because one situation was “worse” than the others, but because the admit did not navigate verification properly. Can you determine who it was?

• Case #1: “Jack” – the family-business manager
Admitted to a top MBA program, Jack had a strong academic record, solid GMAT score, active roles in reputable non-profit organizations, and a unique professional profile. Having worked for several international companies, he rose to a senior management position at a small consumer-goods company.

But there was one vulnerability in his application: Jack had not mentioned that his employer was actually a family-owned business. Was this really a problem? Should he have mentioned it? He didn’t feel this point was material when he submitted his application. If anything, he had worked even harder than he would have for any other company since he expected to become CEO someday! Nonetheless, Jack’s lack of disclosure became apparent during the background verification process when asked about details of his career progress.

Although the application did not specifically ask, “Is your employer company owned by your family?” Jack could have been more forthcoming. Also, one of his recommenders was a family member with a different last name – a relationship he had not disclosed. These are the kinds of judgment calls that many candidates face when describing their professional history. As his background check progressed, Jack felt increasingly uncomfortable.

• Case #2: “Adam” – the startup founder
Adam was a computer-science graduate who partnered with a co-founder after college to build a food delivery app. He worked on the app for six months to determine technical feasibility, then tested a beta version for another month. Seven months into his project, Adam successfully pitched family and friends for seed funding, raised a small capital round, and then incorporated the business. The following year, hoping to round out his entrepreneurial experience, he proudly gained admission to a top-10 MBA program.

But as Adam’s background verification process began, he ran into two issues: employment dates and compensation. He had started working on the app several months before forming the legal corporate entity, and nearly a full year before he began paying himself a salary. On his b-school application, Adam had listed his “starting salary” as the annualized amount he began paying himself 11 months into the venture. However, he listed his “start date” as the date on which he began building the app–about seven months prior to formally incorporating the entity.

Adam honestly felt that this approach was logical and reasonable since the start date reflected when he had actually started working. And his salary was the annualized amount he took when he began to pay himself about a year later. However, when b-school verification began, Adam was asked to reconcile his start date, incorporation date, and first paycheck date through some very uncomfortable communications with the verification agency.

• Case #3: “Lydia” – the growth-stage startup employee
After spending a couple of years post-college in management consulting, Lydia joined a startup as a senior business development manager. As part of her initial job offer, in addition to cash compensation, Lydia received a stock option package. She was also given a budget for purchasing technology hardware and a discretionary personal-fitness allocation. Lydia’s offer letter quantified these perks at $3,000 and identified them as part of her annual compensation.

To better understand the value of her stock options, Lydia approached the founder, who explained the company had received a $5 million valuation in its latest funding round. So, she did the math and concluded that, based on her vesting schedule, she was earning the equivalent of $20,000 per year in stock value.

Because her offer letter stated the stock options, and tech and fitness budgets as part of her “compensation,” Lydia totaled the entire amount and listed that number as “ending salary” on her application. The problem? Shortly after being admitted to business school, Lydia had an unpleasant surprise when asked during background verification to document her compensation. Her employer’s HR department did not consider her discretionary budgets – granted by the company’s accounting and legal team – to be part of her salary. Therefore, HR reported her salary during verification as $23,000 lower than the amount Lydia had, in good faith, listed in her MBA application. She now had to reconcile this difference for the verification agency.

Two of these three candidates effectively explained themselves and enrolled in business school; one could not. Reach out to us to find out if your candidacy may also be at risk in verification and how we can help you navigate this critical process. And click here for more information about our CounterCheck™ services guiding and supporting candidates facing the business-school background verification process.

Also: if you’re an MBA admit anticipating background verification, we invite you to read our blog “Fact: MBA admissions does not guarantee matriculation.”

Your MBA dream is far too important to see it vanish unnecessarily. Contact us today!