Did This Unicorn Startup Just Invent Automated Cheating?
Those who want to cheat will always find ways to cheat, no matter how complex the system is designed to stop them. But what if the ability to cheat was built right into the system? That’s what happened with Zenefits. A secret addition to the software made it so that brokers who had not actually completed a more than fifty hour training course had actually finished that course. They even certified that they had actually done the training, because the software told them they had.
Zenefits is a startup, worth $4.5 billion (sort of) before this recent news came to light, had designed what is being called a secret software tool, which would let health insurance brokers say that they had finished the training course that they must finish before being licensed, without actually finishing that course. This macro just made it look like they were. This is according to an email sent out to Zenefits staff after the former CEO of the startup resigned (read: got fired).
Once they had finished faking the training course, they would then be allowed to certify that they had done the full fifty-two hours of training. The brokers who signed did so under penalty of perjury, and yet many signed anyway, even though they had not actually finished the course and had no intention of finishing the course.
The fact that this program exists inside Zenefits calls into question the credentials of every insurance broker who has used the software, especially in California, where they do most of their business. Besides just communal unrest about the fact that people selling insurance might not actually have had the training they were supposed to have in order to be able to sell the products they are trying to sell, there are the legal concerns. Because the brokers signed under penalty of perjury, it is very likely that those who signed after using the automated cheating tool included with Zenefits could face very real legal issues. The discovery of this program has already lead to the ousting of the former CEO.
Zenefits acts as an intermediary in the health insurance business and has been raising eyebrows for more than a year, when news outlets began to become concerned that they were not properly enforcing the legal requirement that a person who sells health insurance to other people have the right licenses. The investigation that was opened by Zenefits into those claims resulted in the discovery of this program.
The former CEO was actually the creator of the macro. According to sources inside the startup, he created it because he believed that fifty-two hours was far too many hours to be training just to sell insurance policies. At the beginning of 2016, the COO discovered that not only was there a program that allowed them to make it look like they had done the full fifty-two hours, but also that it then told those who faked the training to sign the certification claiming to have finished the entire training.
Once the discovery was made, the company willingly offered up the findings to the regulatory boards. Along with those regulatory bodies, the California Department of Insurance is looking into whether or not Zenefits actually complied with other regulations in the state of California. The CEO was then dethroned, expressly because of his hand in the creation and promotion of this macro. The new CEO reports that they will be taking steps to make sure anyone else involved in the macro is disciplined properly. As of right now, the offending software has been disabled.
What the program essentially did was to log the brokers into the training course indefinitely. After a certain amount of time, without the activation of the program, they would usually be logged out. Instead, the program would not allow them to be logged out. While it did not help them with the quizzes or with actually learning the material, nor did it take the broker exam for them, it certainly did make it very easy to cheat on the required hours of training.
In response to this discovery, Zenefits said they are going to release a retraining program for all of the brokers who used the macro while trying to obtain their license. They are working directly with the Department of Insurance to make sure the remedial training course fits the regulatory board’s requirements. They have decided that instead of punishing the brokers who used the macro, they are simply going to require them to actually do the training they said that they needed to do. They are also taking steps to make sure that their own employees and the people who use Zenefits understand the real legal ramifications of their actions.