2 years down the line imagine you're in line for your dream job. Manager's about to pull the trigger, and they see that Joe also worked with you at Acme Consulting.
'Hey Joe, we're thinking of hiring giantg, what's your thoughts?'
'giantg? Yeah he was good, but then one day he just didn't turn up for work. Not sure what he did...'
The important part here is that if my company tells my old coworkers why I left or the circumstances around it, that would be a violation of employee privacy and a violation of their own policies. Lawyer please.
And it's not about your team it's everyone in your company. Plus potentially a bunch of their friends they mention the story to.
"Hey Joe, didn't you tell me about a guy called Giant who just disappeared one day when you worked at Acme? Was it Giant G?"
"Yeah, it was, why?"
"Oh, he's popped up as a potential hire, I'll tell HR to nix him"
I guess it really depends on the size of your local market, but in my area I've bumped into multiple people more than once across jobs/contracts/meetups/etc.
Waste what money? If it's a good case, then it would be handled on a contingent basis.
Frankly, I'm tired off all the BS prestige and reputation. I have plenty of people that have a high opinion of me and that wouldn't change with this scenario. People who did find out would message me to ask what happened. I actually ran this scenario by a friend at the company and they said it makes sense and they would do the same thing. It's stupid that promotions and hiring is all about backroom deals and bias.