It could be an embarrassing revelation or it could be case related if it is true....it certainly would open someone up to blackmail or at least allow certain things to go on that normally one wouldn't allow....for instance, having an excon who is often late and not trustworthy work at your house, and be around your children.....
The Smarts had no knowledge of Ricci's criminal background and were apparently conned by him. They liked him, trusted him, and couldn't believe that he was involved with Elizabeths abduction until he pulled his stonewall act with them and LE.