Airbubba, interesting post.
Your theory brings up some possibilities that
a) they were not aware and somehow he hid this from the company if it is indeed true (easy enough to apply with a second passport, plenty of the cabin crew do especially those who may have been let go from other airlines)
And/or b) someone knew about it and approved him anyway, as we know the clique can be strong in the sandpit and morals are only as strong as the weakest member of the group. *if* this person had a friend on the inside at the time of application that could also explain why he got into the position he did.
So either it isn't true, the background checks are inadequate, or someone in the company is passing people through who are unsuitable. How many more are there?
On the subject, not a sigle one of my references were actually contacted prior to my being employed. I know because I asked them. So they were going by whatever databases they had access to and checked (if they actually checked)