{"id":503404,"date":"2021-03-25T15:35:19","date_gmt":"2021-03-25T10:05:19","guid":{"rendered":"\/?p=503404"},"modified":"2026-01-07T15:57:27","modified_gmt":"2026-01-07T10:27:27","slug":"cost-of-wrong-hire","status":"publish","type":"post","link":"https:\/\/blog.in.springverify.com\/cost-of-wrong-hire\/","title":{"rendered":"A Bad Hire costs a Lot: Here\u2019s why Background Verification Is a Must in 2026"},"content":{"rendered":"\n<p>Every employer today is fighting a war against wrong hires. A bad hire costs a lot more than you think.They never want to lose out on the best talents and resources. They might depend on a few websites and tools to make this happen.&nbsp;<\/p>\n\n\n\n<p>But wouldn\u2019t it be a wrong choice while you invest huge bucks in <a href=\"https:\/\/www.springworks.in\/blog\/hire-right-talent-for-a-startup\/\">enhancing your hiring process<\/a>, your employees end up fidgeting with the bad hire.<\/p>\n\n\n\n<p><a href=\"https:\/\/en.wikipedia.org\/wiki\/Tony_Hsieh\">Zappos CEO Tony Hsieh<\/a> estimated that hiring the wrong person had actually cost the company nearly $100 million.<\/p>\n\n\n\n<p>In this article, we\u2019ll discuss the real cost of a bad hire and why a background check is a must!<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-69dd21f1abd83\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69dd21f1abd83\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/blog.in.springverify.com\/cost-of-wrong-hire\/#How_much_does_a_bad_hire_cost_a_company\" >How much does a bad hire cost a company<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/blog.in.springverify.com\/cost-of-wrong-hire\/#How_can_an_employer_avoid_hiring_the_wrong_person\" >How can an employer avoid hiring the wrong person?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/blog.in.springverify.com\/cost-of-wrong-hire\/#Why_Background_Verification_Is_Must\" >Why Background Verification Is Must<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/blog.in.springverify.com\/cost-of-wrong-hire\/#Keep_Your_Workplace_and_Customers_Safe\" >Keep Your Workplace and Customers Safe&nbsp;<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/blog.in.springverify.com\/cost-of-wrong-hire\/#Avoid_Criminal_Activities\" >Avoid Criminal Activities<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/blog.in.springverify.com\/cost-of-wrong-hire\/#A_Quick_Recap\" >A Quick Recap<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/blog.in.springverify.com\/cost-of-wrong-hire\/#FAQ\" >FAQ<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_much_does_a_bad_hire_cost_a_company\"><\/span>How much does a bad hire cost a company<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Every bad hire is equivalent to a rotten apple. They take pleasure in spoiling the work culture and the mindset of the team members. You can calculate the the true cost of a bad hire follows:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Quantitative Loss<\/h3>\n\n\n\n<p>Every bad hire can bring down the chances of leveraging an organization\u2019s resources productively. You might invest in coaching, training, and mentoring along with disciplinary actions and performance reviews.&nbsp;<\/p>\n\n\n\n<p>Be it spending on administration and designing tools, your overall effort wouldn\u2019t prove fruitful. When the employee leaves, you might have to restart it. This would lead to potential costs of a bad recruitment decision in terms of financial burdens and loss of productivity.<\/p>\n\n\n\n<p>The average cost of one bad hire is nearly $15,000! (Source)<\/p>\n\n\n\n<p>The Undercover Recruiter reports bad hires can cost $240,000 in expenses. Those are broken down into costs related to hiring, pay, and retention. (<a href=\"https:\/\/theundercoverrecruiter.com\/infographic-what-cost-hiring-wrong-employee\/\">Source<\/a>)<\/p>\n\n\n\n<p>Additionally, here are three points to consider when trying to determine the cost of a poor hire:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The higher the position (and thus higher the salary), the higher the cost of the wrong hire&nbsp;<\/li>\n\n\n\n<li>The longer the ill-placed person has worked at the company, the higher the cost of the bad hire<\/li>\n\n\n\n<li>The more training wasted on the person, the higher the cost of the bad hire<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Qualitative Loss<\/h3>\n\n\n\n<p>While any bad hire can imply productivity loss, it is often the good employees who need to compensate for the old and forgotten misgivings. This can pave the way for deprivation among top performers. Remember, this hullabaloo can keep dragging long after the bad employee has left the organization.<\/p>\n\n\n\n<p><a href=\"https:\/\/www.shrm.org\/resourcesandtools\/hr-topics\/employee-relations\/pages\/cost-of-bad-hires.aspx\">Research<\/a> states that 43% of companies got fizzled up with bad hires since they had to hire a person ASAP.<\/p>\n\n\n\n<p>Another form of cost of poor recruitment and selection can be the&nbsp; negative impact on co-workers and the team as a whole. If they are in a leadership position, the impact can be much worse. Self-motivation often relies on environmental factors. If the environment is negative, it can be challenging to be motivated at work. A bad hire can make it difficult for a team to meet their goals. That\u2019s because a co-worker or team will be hesitant to work with them and vice versa.<\/p>\n\n\n\n<p>They can impact everything from the cost of screening, assessments, candidate selection, as well as other hiring processes such as technology and travel costs. From exit formalities to severance packages, everything would come under the radar of a bad hire. This can have serious impacts on the overall business culture.<\/p>\n\n\n\n<p>To avoid such unpleasant situations, businesses have to forgo hasty hiring decisions. A bad hire can pose a long-term threat, whereas a good hire can let you win a fortune. <a href=\"https:\/\/in.springverify.com\/employment-background-checks\/\">Employee background verification<\/a> can help you make smart hiring choices.<\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-full\"><a href=\"https:\/\/in.springverify.com\/contact-us\/?utm_source=SpringVerify+India+Blog&amp;utm_medium=cost+of+wrong+hire&amp;utm_campaign=SpringVerify+Blog+Conversion\"><img fetchpriority=\"high\" decoding=\"async\" width=\"600\" height=\"200\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAP\/\/\/wAAACH5BAEAAAAALAAAAAABAAEAAAICRAEAOw==\" data-src=\"https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/2-2.png\" alt=\"hassle-free-bgv-get-started-now-banner\" class=\"pure-lazyload wp-image-508910\" data-srcset=\"https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/2-2.png 600w, https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/2-2-300x100.png 300w, https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/2-2-60x20.png 60w, https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/2-2-480x160.png 480w\" sizes=\"(max-width: 600px) 100vw, 600px\" \/><noscript><img fetchpriority=\"high\" decoding=\"async\" width=\"600\" height=\"200\" src=\"https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/2-2.png\" data-src=\"https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/2-2.png\" alt=\"hassle-free-bgv-get-started-now-banner\" class=\"pure-lazyload wp-image-508910\" srcset=\"https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/2-2.png 600w, https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/2-2-300x100.png 300w, https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/2-2-60x20.png 60w, https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/2-2-480x160.png 480w\" sizes=\"(max-width: 600px) 100vw, 600px\" \/><\/noscript><\/a><\/figure>\n<\/div>\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_can_an_employer_avoid_hiring_the_wrong_person\"><\/span><strong>How can an employer avoid hiring the wrong person?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Why_Background_Verification_Is_Must\"><\/span>Why Background Verification Is Must<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>There are six compelling reasons to <a href=\"https:\/\/in.springverify.com\/blog\/employee-background-check-guide\/\">run background checks on all job applicants<\/a>:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Avoid Bad Hires<\/h3>\n\n\n\n<p><a href=\"https:\/\/us.springverify.com\/blog\/resume-verification\/\">Resume background verification<\/a> plays a crucial role in making better hiring decisions. 84% of employers continue to derive significant benefits from background checks.<\/p>\n\n\n\n<p>Appropriate background screening can help you hire right by verifying all the relevant details, so you don\u2019t have to let go of your hire later.<\/p>\n\n\n\n<p>Knowing as much as possible about your potential hires is crucial. After all, the individual you hire will have access to critical data and documents that belong to your organization.<\/p>\n\n\n\n<p>Here are three steps that can lower the risk of a bad hire:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Prepare a list of traits and characteristics that you\u2019re looking for in a potential employee.<\/li>\n\n\n\n<li>Assess how you will gather the data necessary to make a successful hiring decision.<\/li>\n\n\n\n<li>Armed with the right data, be strategic with the interview process to find the right people.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Verify Candidate\u2019s Qualification<\/h3>\n\n\n\n<p>You should never solely base a <a href=\"https:\/\/us.springverify.com\/blog\/social-media-background-check\/\">hiring decision on the review of a candidate\u2019s social media profile<\/a>. Tailor the screening process to reflect your industry and the jobs for which you hire.&nbsp;<\/p>\n\n\n\n<p>Prospective job candidates who are not properly screened can negatively impact your organization. For example, an individual who misrepresents their education or work experience may not produce high-quality results.<\/p>\n\n\n\n<p>75% of HR managers have caught a<a href=\"https:\/\/in.springverify.com\/blog\/faking-experience-is-increasingly-becoming-common-during-a-job-hunt\/\" target=\"_blank\" rel=\"noreferrer noopener\"> lie on a resume<\/a>, according to a CareerBuilder survey. The resume can no longer be considered as a reliable source of information about the prospective employee. A thorough verification (includes education, employment, and <a href=\"https:\/\/in.springverify.com\/screenings\/reference-verification\/\" target=\"_blank\" rel=\"noreferrer noopener\">reference verification<\/a>) may reveal some alarming facts that could impact your hiring decision.<\/p>\n\n\n\n<p><a href=\"https:\/\/www.springworks.in\/blog\/employee-background-check-guide\/\">Background checks<\/a> enable organizations to make intelligent decisions by hiring only those candidates who have the required skills and have the right attitude and behavior to be a perfect cultural fit.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Keep_Your_Workplace_and_Customers_Safe\"><\/span>Keep Your Workplace and Customers Safe&nbsp;<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Think transportation, finance, day-care, healthcare, and education, where employees are in direct contact with customers. Employees who may have access to sensitive customer information can be a threat to their safety.&nbsp;<\/p>\n\n\n\n<p>Food delivery company <a href=\"https:\/\/economictimes.indiatimes.com\/small-biz\/startups\/newsbuzz\/background-screening-is-a-gig-that-needs-fixing\/articleshow\/72000415.cms\">Zomato<\/a> rejects about 25% of applications due to various reasons such as unavailability of proper documents, failure in background check clearance, and lack of right intent to work as a delivery partner.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Avoid Negligent Hiring Liability<\/h3>\n\n\n\n<p>Negligent hiring can cause harm to businesses, employees, and clients. When you\u2019re hiring an employee, you need to make sure they have cleared a background screening. This helps avoid unnecessary risks and reduce insurance liability in adverse scenarios.&nbsp;<\/p>\n\n\n\n<p>Suppose you\u2019re hiring a delivery executive for your e-commerce business. In that case, you need to make sure that they have a valid driving license without any strikes. In case they end up in a road accident, remember that you will be liable for them.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Protecting the Company\u2019s Reputation<\/h3>\n\n\n\n<p>A company is made of and known by its people. Employees are the face of the company, and their decisions and actions directly impact the company\u2019s performance and brand reputation. Company image can influence the sales and even the price of its products or services.<\/p>\n\n\n\n<p>It is necessary to do a thorough background check of the executive before bringing him on board. When you hire individuals who are dangerous or unsavory, it leaves a wrong spot on your name. Not to forget that it might also compromise the integrity of your brand.&nbsp;<a href=\"https:\/\/in.springverify.com\/background-verification\/?utm_source=google&amp;utm_medium=cpc&amp;utm_campaign=brand-search&amp;utm_source=google&amp;utm_medium=cpc&amp;utm_campaign=brand-search&amp;matchtype=p&amp;device=c&amp;campaignid=15152511744&amp;loc_physical_ms=9301993&amp;network=g&amp;keyword=springverify&amp;placement=&amp;loc_interest_ms=&amp;gclid=Cj0KCQjw2MWVBhCQARIsAIjbwoOQ4MDvlestzFx-Zh8nF2ufX9gq5FEi0Fq4KYTMj2WM6dGfxrXQp6UaAmXcEALw_wcB\"><\/a><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Avoid_Criminal_Activities\"><\/span>Avoid Criminal Activities<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Conducting <a href=\"https:\/\/in.springverify.com\/blog\/criminal-background-check\/\">criminal background checks<\/a> is a crucial step in bringing an employee on board.<\/p>\n\n\n\n<p>An individual\u2019s criminal history affects not only a company\u2019s safety but also job performance and qualification. If you are hiring a stock manager who handles inventory and funds (the job requires a high level of trust), it\u2019s important to see if the individual has ever been charged with theft or fraud.<\/p>\n\n\n\n<p>While it might not always mean rejecting the applicant, it could refer to minor modifications in the hiring contract. But the point is that unless you have the complete background information, there is no way you can make an appropriate decision.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"A_Quick_Recap\"><\/span>A Quick Recap<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Here\u2019s what we have learned from our quick drive through the <a href=\"https:\/\/us.springverify.com\/blog\/simplifying-the-employee-verification-process\/\">background screening process<\/a>:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>With each shortcut to the recruitment process comes an associated risk to your company.&nbsp;<\/li>\n\n\n\n<li>There are many costs associated with a bad hire, some direct and some indirect, which can be better mitigated with a thorough screening program.&nbsp;<\/li>\n\n\n\n<li>There can be a high price to pay for companies who don\u2019t check their candidates\u2019 education and professional credentials.&nbsp;<\/li>\n\n\n\n<li>Background screening can help manage this risk and identify candidates with reportable criminal activity history to help inform your hiring decisions.&nbsp;<\/li>\n<\/ul>\n\n\n\n<p><em>When it comes to employment screening, we believe it\u2019s better to be safe than sorry. A background verification solution will filter out the bad, retain the best \u2013 key for a harmonious work environment and steady business growth.<\/em><\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-full\"><a href=\"https:\/\/in.springverify.com\/contact-us\/?utm_source=SpringVerify+India+Blog&amp;utm_medium=cost+of+wrong+hire&amp;utm_campaign=SpringVerify+Blog+Conversion\"><img decoding=\"async\" width=\"600\" height=\"200\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAP\/\/\/wAAACH5BAEAAAAALAAAAAABAAEAAAICRAEAOw==\" data-src=\"https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/29.png\" alt=\"SV-BGV-get-started-now-banner\" class=\"pure-lazyload wp-image-508912\" data-srcset=\"https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/29.png 600w, https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/29-300x100.png 300w, https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/29-60x20.png 60w, https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/29-480x160.png 480w\" sizes=\"(max-width: 600px) 100vw, 600px\" \/><noscript><img decoding=\"async\" width=\"600\" height=\"200\" src=\"https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/29.png\" data-src=\"https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/29.png\" alt=\"SV-BGV-get-started-now-banner\" class=\"pure-lazyload wp-image-508912\" srcset=\"https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/29.png 600w, https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/29-300x100.png 300w, https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/29-60x20.png 60w, https:\/\/blog.in.springverify.com\/wp-content\/uploads\/2022\/06\/29-480x160.png 480w\" sizes=\"(max-width: 600px) 100vw, 600px\" \/><\/noscript><\/a><\/figure>\n<\/div>\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"FAQ\"><\/span>FAQ<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">How does a bad hire affect a company?<\/h3>\n\n\n\n<p>The consequences of a bad hire within the company can be as follows:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li>Ruin the company\u2019s reputation<\/li>\n\n\n\n<li>Increase the financial cost for hiring a replacement<\/li>\n\n\n\n<li>Wastage in terms of time and money invested in the hire.<\/li>\n<\/ol>\n\n\n\n<h3 class=\"wp-block-heading\">How do you deal with a bad hire?<\/h3>\n\n\n\n<p>When you feel that a specific person can be a bad hire, here\u2019s what you should do:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li>Ask the hire\u2019s teammates for their opinions.<\/li>\n\n\n\n<li>Figure out if training them would help.<\/li>\n\n\n\n<li>Have a conversation about the issue with them directly.<\/li>\n\n\n\n<li>If none of this helps, analyze the cost of firing and replacement.<\/li>\n\n\n\n<li>See what you did wrong and ensure that you don\u2019t repeat it in the next hiring process.<\/li>\n<\/ol>\n\n\n\n<h3 class=\"wp-block-heading\">How long does it take to recover from a poor hire?<\/h3>\n\n\n\n<p>It is ideal to take prompt actions when you realize a bad hire within the company. The more you take the process slowly, the longer consequences will last.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In this article, we\u2019ll discuss the real cost of a wrong hire and why a background verification is a must! Read it now!<\/p>\n","protected":false},"author":6,"featured_media":508667,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[102670],"tags":[],"class_list":["post-503404","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-employment-check","disable-dropcap","disable-2-columns"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Bad Hires Are Costly: Why Background Verification Is Essential<\/title>\n<meta name=\"description\" content=\"A single bad hire can hurt productivity, morale, and profits. 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