Facial Recognition Market to Grow 12.5% Annually Through 2024

Facial Recognition Market to Grow 12.5% Annually Through 2024

According to a new report by Mordor Intelligence, the facial recognition market is expected to grow at an annual growth rate of 12.5% for the forecast period 2019 to 2024. In 2018, the market was valued at $4.51 billion and by the end of 2024, it is expected to reach a value of $9.06 billion by 2024, according to the press release. 

Facial recognition is quickly picking the pace and will be surpassing fingerprint scans in the future. At present, around 94% of smartphones feature fingerprint sensors but this is expected to drop to 90% by 2023. 

Facial recognition

(Image Courtesy: Mordor Intelligence)

The increase in the 3D cameras market is also expected to bring advancements and new applications for 3D facial recognition technology. The areas of healthcare, commerce, payments, and IT solutions are benefitting a lot. 

Facial recognition systems are also being adopted for widespread mass surveillance to enhance safety and security. This is another reason for the increased market for facial recognition. Government-led initiatives are also contributing to the double-digit growth of such technologies.  

North America is expected to hold the highest market share for facial recognition technology as it offers huge opportunities for homeland security and criminal investigations. The biggest facial recognition system is being operated in North America by the FBI. The ID system of FBI maintains a database with data on more 117 million Americans and conducts an average of 4055 searches every month to identify individuals. In 2017, the US alone witnessed 1579 data breaches and 8% of the data breaches were reported by financial institutions.  Due to these factors, facial recognition technology to provide a more enhanced layer of security is imperative. 

Fintrac Warns Casinos of Gamers Paying with Bank Drafts

Fintrac Warns Casinos of Gamers Paying with Bank Drafts

Canada’s anti-money laundering agency is warning casinos to be cautious of customers who pay for their gaming with their bank drafts. Bank drafts are becoming the latest method for criminals to disguise dirty money. 

FINTRAC, Financial Transactions and Reports Analysis Centre of Canda, issued an operational alert on December 10 that cash is not being favored anymore in illegal casino transactions due to excessive media and government scrutiny.

Instead of cash, criminals are choosing bank drafts for their liquidity and quasi-anonymity. According to the Fintrac director, Nada Semaan, professional money launderers are constantly changing their methods. 

“They will always be looking at different ways to do it, and our job is to be a step ahead of them and figure that out. We can’t stop everybody, but we are working extremely hard on this and we are committed to doing more.”

Fintrac tries to identify and investigate the cash linked to terrorism and money laundering by going through huge piles of information annually from banks, securities dealers, insurance companies, money service businesses, casinos, real estate brokers and many others. 

The latest alert published by Fintrac is a part of Project Athena, an RCMP-led public-private partnership aimed at disrupting money-laundering activity in British Columbia and across Canada. This project continues to upgrade previous initiatives targeting the fentanyl trade, romance fraud, and human trafficking. 

The operational alert and a list of signs that dirty money is being washed using casinos were generated through the analysis of Fintrac’s financial intelligence in collaboration with the Combined Forces Special Enforcement Unit in British Columbia.

Fintrac suspects that most people involved in dubious casino-related transactions were money mules who moved crime profits, consciously or unconsciously, on behalf of a money launderer.

According to the alert, the first type commonly reported their occupation as “student” or simply “unemployed”. The second type of money mule often reported their occupation as “homemaker”. 

Fintrac is notifying casinos to examine patrons who:

— Deposit a high volume of bank drafts to a gaming-fund account or who regularly use bank drafts as a form of gaming buy-in;

— Are accompanied to a casino by someone subject to a gaming ban;

— Live in a jurisdiction subject to currency-control restrictions or sanctions and have no local ties to family or businesses.

7 Best KYC and Fraud Prevention Tips for Online Businesses

7 Best KYC and Fraud Prevention Tips for Online Businesses

With the explosion of internet and web applications, the online interaction between consumers and businesses is continuously increasing. The digitization of business operations is raising the demand for advanced technological solutions to deal with the growing digital fraud and create trust among consumers to stay ahead of competitors in the market.

With every passing year, the fraud cases are growing eventually resulting in great losses for businesses and individuals. As per the study conducted in 2018, 63% of the business have experienced either the same or increased number of digital frauds. This increased ratio in online frauds is intensifying the need for quick and effective verification processes.

As we are approaching the data-driven market, customer experience is equally important for secure business growth. As per the study by Experian 2018, 75% of the business expressed their interest in acquiring the security measures and authentication processes that have an impact on customer experience as well. No matter what the business domain is, every digital enterprise needs to maintain an effective and compliant KYC (Know your customer) onboarding process.

Understand the Onboarding Process Thoroughly

An effective customer onboarding process plays a significant role in developing a strong and long-lasting relationships with new clients. The streamlined onboarding of clients facilitates businesses in filtering the good clients from suspicious and fraudulent ones. But in order to do so, it is essential to understand the KYC onboarding process in detail. 

The process is not much complicated and contains almost the same steps. The foremost is to gather relevant data and identification documents. The collected data and documents are authenticated through in-depth background checks linked to previous employment history, financial transactions, and other activities. The authentication doesn’t end here, further investigation is carried out to get a clear history of the client in terms of fraudulent or criminal activities.

KYC Verification also includes the mapping of client data against fraud prevention and anti-money laundering (AML) protocols to figure out any red flags. Moreover, the customer is also investigated for involvement with Counter Financing Terrorism (CFT). Lastly, based on the findings and resulting information, the businesses assign clients risk rating i.e. low, medium or high. 

Once you completely streamline the onboarding process, it would be very easy to meet the regulatory compliance while building a secure customer base.

Collect Extensive data

Know your customer (KYC) and know your business (KYB) processes are specifically designed to curb fraud and financial crimes like terrorist funding and money laundering. Meeting the KYC requirement not only facilitates your business in risk management but also increases overall security and compliance with CFT and AML regulations.

To ensure comprehensive KYC compliance, the collection of relevant data is essential. When you will have inclusive information regarding the client it would be more productive to carry the KYC process seamlessly.

Use Third-Party Identity Verification Services

Digital problems need digital solutions. Manual KYC and verification processes are prone to error, time-consuming, and costly. Multiple SaaS companies are coming up with enhanced digital security measures and services. Outsourcing your identity verification and authentication processes to some third party is quite an effective, convenient and affordable solution.

The security requirements often vary from business to business depending on the type of risks associated. For instance, in the case of financial institutes, the monetary fraud risks are higher as compared to other industries. Various digital identity verification solutions and KYC services decrease the likelihood of online businesses from being targeted meanwhile complying with KYC/AML regulations. 

Enhancing Authentication Checks

In online businesses, account takeover fraud and identity theft are significantly cultivating frauds. To prevent such frauds, the best way is to enhance your authentication processes. Cybercriminals and fraudsters have become sophisticated in exploiting user credentials – which means simple password protection is no more reliable. Implementing biometric and multi-factor authentication in your business can keep the attackers at bay.

These technologies verify and authenticate the identities on the basis of their unique biometric features which are nearly impossible to steal or exploit. Moreover, as per Visa Study 2017, 71% of the respondents think biometrics are easier than passwords and 46% find biometrics more secure.

Exercise Common KYC Tests to Combat Identity Fraud

Identity theft is a major concern for online businesses these days. According to the Federal Trade Commission’s (FTC) report, around 1.4 million identity theft fraud reports were processed in 2018 with a total loss of around $1.48 billion. To prevent these frauds, your business can use some common KYC practices every now and then. 

These checks are quite imperative for every type of online business. There can be some other tests as well that you can design in a similar way to curb identity theft.

Ensure secure Payment Methods

For the startups, managing a few transactions a day is no big deal. But as you scale to hundreds of transactions per day, throwing caution to the wind can land you in big problem. Whether your organization accepts credit cards, PayPal or Skrill payments, it is essential to be aware of their security policies that are likely to impact your business.

According to Statista 2018 report, US merchants lost around $6.4 billion due to payment card frauds. Among the victims, small businesses suffered most – i.e. an estimated loss of $155,000.

To familiarize yourself with your payment service providers’ policies and applying security measures to secure the payment methods is a great business practice. Doing so prevents fraud while tightening reins on cybercriminals and imposters.

Fight against Chargebacks

Chargebacks are becoming a major issue for online businesses. They are mostly the result of consumer fraud contrary to identity fraud – occurred due to unauthorized payments from customers’ accounts or cards. Different credit card companies have different chargeback policies, so it’s better to go through them thoroughly. 

It is better to take precautionary measures than suffer chargeback loss. You can always track your payments. It helps you to claim your proof against chargebacks. By providing the delivery receipts and invoices, you can have the case in your favor and prevent financial loss. 

account takeover feature img

Account Takeover Frauds – Impact, Causes, and Prevention

Living in the era of technology, the world is rapidly moving towards digitization. From banking institutions to shopping stores, every organization is shifting its operations online. Going digital is no doubt providing a competitive edge to organizations to meet customer demands. On the other hand, the online presence has raised serious concerns for both individuals and businesses by exposing digital information to cybercriminals. As a result, there has been a significant increase in digital fraud, specifically account takeover (ATO) fraud. 

What is account takeover fraud?

 

Account takeover (ATO) fraud is the type of identity fraud that involves unauthorized criminal access to a user’s account to use it for some type of personal and financial gain. The increased presence of people on the internet and involvement in activities like online shopping and banking and convenient funds transfer has opened new opportunities for criminals looking to make extra cash.

ATO fraud can involve the exploitation of multiple types of online accounts, including online banking, eCommerce, mobile, and social media accounts. Generally, cybercriminals and fraudsters lookout for the accounts from which they can steal money and gain monetary advantages. For instance, targeting bank accounts for fund transfer to own account or eCommerce accounts to make fraudulent purchases. Also, the imposters can take over social media accounts and request money from the family and friends of the victims.

Ecommerce platforms are the most profitable for criminals due to frictionless payment systems. In e-commerce sites, due to instant purchase functionality, all the billing information is stored in the user account that makes it convenient for the customers to make purchases. But it also makes it handy for criminals to simply change the shipping address and start making a purchase, once they discover the login credentials.

Impact of ATO Frauds

 

Account takeover fraud rates have been on the rise for the last few years. Every year the individuals and businesses incur huge losses due to ATO frauds. Mostly customers are the ones who endure monetary losses. In addition, in most cases, they not only lose time in resolving fraud but also suffer a damaged reputation and relationships, for example, in the case of social media account take over. Businesses, however, suffer losses in the form of chargebacks and bruised reputation. 

Last year in May, KREM2 reported a case ATO fraud in which the victim, “Allie Raye” wasn’t aware of the fraud until she started receiving shipping notices and orders from Amazon. Even after discovering it, it was very difficult for her to stop the fraudulent orders – that included several gift cards. It took her around three weeks to regain hold of her account and all this while she lost $1,640 in fraudulent purchases. In that case, the Amazon had to suffer the actual loss by ultimately refunding Raye the whole amount.

 

Factors fueling ATO frauds

 

Account takeover fraud is a serious concern not only for the individuals but businesses as well. The technological innovations have made the fraudsters more sophisticated in accessing users’ information. There are multiple factors that are fueling ATO frauds, some of them are: 

 

  • Data Breaches

 

One of the main driving factors behind account takeover frauds is the increasing trend of data breaches. The purpose of a data breach is to access the records of the customers containing their information – for example, usernames, passwords, account numbers, and card numbers, etc. The list obtained from the breach is sold in the black market where the numbers of cybercriminals are readily looking for users’ data.

When the username and password of an account are known, hackers try the same combination on multiple online platforms through various automated tools – known as credential stuffing. According to Perimeterx Research, there is an 8% success chance of these attacks. Moreover, if criminals have access to the username and email address they can use multiple attacks, for instance, brute force, to guess the passwords. 

 

  • Weak Password Practice and Inefficient Authentication

 

More online presence of individuals means more accounts. It means users have to remember all the usernames and passwords for different accounts. The difficulty memorizing them encourages the users to set the same passwords for multiple accounts. This is a very common yet highly risky practice. It is found that 21% of people use passwords that are 10 years old and at least 71% reuse their passwords. This weak password practice exposes users to cybercriminals. Through brute force attacks and credential stuffing, they can easily take hold of users’ credentials and accounts.

Most of the organizations still rely on the binary authentication method i.e. using username and password. Anyone having access to those credentials can easily log in to the account and do whatever they want. This is one of the main reasons for account takeover.

 

  • Social Engineering Tactics

 

The advent of technology has significantly provided fraudsters and imposters with advanced social engineering tactics; phishing is one of them. Through phishing attacks, cybercriminals are accessing user credentials by tricking the users. There are multiple ways through which these attacks can occur – including through email, text message or even over the phone. However, the purpose is the same, i.e, trying to get the users to hand over their information.

An example of such an attack is receiving an email that persuades you to click the link and prompt the login page to enter your credentials which are stolen by criminals.

 

  • Threat by Device

 

Another factor that is driving the ATO fraud threat is through smart devices – mobiles and mobile applications are prime targets of cybercriminals for ATO fraud. One of the major reasons for this is the technology lag. Regardless of advanced tools designed to protect users on web browsers, those tools don’t work for mobile apps at the same time. According to Rippleshot’s State of Card Fraud 2018 report, mobile phones are becoming increasingly vulnerable targets of ATO frauds and would rise in the future as well.

 

Factors fueling ATO frauds

How to prevent ATO frauds?

 

 

No doubt ATO fraud is the major concern for the businesses especially for e-commerce, however, they can be prevented using proper user verification at the time of onboarding. Sometimes after committing the ATO fraud, the fraudsters use that information of the user to create another account. Through digital identity verification services, businesses can ensure the identity of real users and hinder the fraudster from creating fake accounts – i.e. committing identity theft.

 

  • Identity Authentication

 

The main factor that fuels ATO frauds, is the lack of proper authentication checks. In this world of no trust, stealing someone’s credentials is no more a difficult task. By applying the social engineering phenomenon, the fraudsters can trick users to provide their information. If online businesses follow proper and advanced authentication services like 2-Factor Authentication and Biometric verification through Face verification, then the account takeover frauds can be prevented.

The users who fail to verify and authenticate their identity can be hindered from accessing the account in real-time. 

 

  • Monitoring Payments

 

ATO frauds are done to gain monetary benefits mostly. The frictionless mobile and online payments are no doubt enhancing the user experience, but at the same time, it is grabbing the attention of cybercriminals. Whenever the imposters take over the account, let’s say bank account, the first thing they do is transfer money to their account.

Due to a lack of payment monitoring or authentication before processing transactions, the cybercriminals are successful in making fraudulent payments. Monitoring the payment every single time when a user request a transaction can combat fraudsters in real-time. 

Face Verification – A Strong Weapon against ATO frauds

 

Face verification is the advanced form of biometric verification powered by artificial intelligence and machine learning algorithms. The traditional verification and authentication check have failed to prevent the fraudsters from accessing the users’ data and personally identifiable information (PII). Integrating face verification API with the existing platforms can identify the fraudsters beforehand who may try to enter the system through spoofing measures.

 

Face Verification - A Strong Weapon against ATO frauds

Credit Card Fraud

How Businesses Can Avoid Identity Verification Fraud in 2019?

With a bulk of customers using online services, businesses wish to digitise their operations and provide online modes of payments for their customers. Amidst this digital integration arises the threat of credit card fraud and what business must do to protect themselves from it. The figure for worldwide card fraud losses crossed the mark of 31 billion US dollars in 2018. Although consumers suffer in the worst way through credit card scams, businesses are not far behind and can suffer just as much – if not more.

Fraud Prevention tips for Consumers

Every now and then, almost every entity including governments, banks, financial institutes and businesses issue numerous credit card fraud detection tips for consumers. Individually every credit card user must be smart and vigilant enough see some obvious warning signs for fraud;

  • Beware of phishing scams – never click on links provided via e-mail; they tend to have malware.
  • Beware of social engineering scams. Banks, governments and online retailers never ask people for their personal information (ID card numbers, account or credit card numbers, passwords and PINs) via e-mail, phone calls or direct messaging.
  • Keep your personal information secure and avoid giving out any potential identity information on social media platforms. Block your stolen credit card as soon as possible and report the theft.

As technology has advanced at an exponential rate worldwide, credit card fraudsters have found better and yet more sophisticated ways to commit credit card identity theft. Thus it is equally important for businesses to implement equally advanced fraud prevention measures. Individually every business may not be able to develop sophisticated and effective online fraud protection. In recent years, however, the fraud prevention industry has made impressive breakthroughs in this regard.

Apart from such anti-fraud solutions, companies also need to take some active measures to prevent identity theft on their end;

Monitor Your Transactions

In a world dominated by consumers, most of them have moved away from cash payments and are increasingly using online payment modes. Although the use of EMV chip cards has made it difficult for scammers to commit credit card fraud, they can still find ways around them. For this purpose, it is important for businesses to monitor their transactions, both online and physical. There are a number of warning signs in a transaction that can alert you as to whether it is a fraudulent one.

 

  • Check to see if the billing and shipping address for the transaction same or different. If so, then why?
  • Also, evaluate the average order size for the nature of your business. If any transaction is larger than the average amount, check to see why.
  • Be careful in case the order has been requested overnight.
  • Be in the lookout if a large number of orders have been placed through the same credit card.
  • Beware if your address verification provider cannot verify the shipping address of the customer.

It is understandable that no business can verify each and every single one of its transactions individually. Particularly if the transaction volume of the business is large, manually verifying each transaction can take an army of human labour. For such situations, it is advisable to avail the services of a verification service provider that can authenticate both the identity as well as the address of every transaction through an automated procedure.

Implement Damage Control if Credit Card Fraud Happens

The only way businesses can completely eliminate online credit card fraud or identity fraud is to not accept credit cards or online payments at all. This is obviously impossible as almost every consumer owns a credit card or prefers to shop online. Therefore, entirely eliminating fraud is an unlikely scenario for businesses as well as consumers. Businesses should be vigilant if any cases of card fraud surface. Firstly, it is always advisable to report the crime to the relevant authorities to take the appropriate action. You should always cooperate with them and provide them as much information about the crime as possible.

Also, be responsive to customers who have been affected by the fraud and provide them with any assistance you can. Listen to their case vigilantly and try to compensate them in any way you can.

Modern Credit Card Fraud Prevention Tools

The market for fraud prevention solutions has expanded over the years. Amidst the solutions currently available for credit card fraud protection, Shufti Pro has emerged as a leading Know Your Customer or KYC verification service provider. It is the best credit card protector for any business and provides a number of verification services to businesses.

It is a SaaS product that provides document verification, address verification and facial recognition services to businesses. Shufti Pro’s AI-based authentication software can verify customers within seconds. Credit card fraud prevention has never been easier. Through customer verifications, businesses can ensure that each of their transactions is legitimate.

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Fraud Prevention through Secure Payment Processes
fraud prevention detail

5 Industries Where Anti Fraud Solutions are Gaining Prominence

Every profit generating business has some level of risk of falling victim to fraudulent activities. The constant threat of fraud in the market encourages businesses to seek out fraud detection and prevention services. The sector that is immensely vulnerable to and affected by frauds and scams is the Banking, Financial Services and Insurance (BFSI). Fraud, in general, is responsible for a loss of one trillion US dollars to both online retailers and financial service firms. However, the finance sector is not the only industry plagued with scammers and fraudsters. Such circumstances have led companies to seek fraud analytics and anti fraud services.

Anti Fraud Solutions on the Rise

Fraud analysis, however, is not enough; for businesses to take an on hands approach to battle fraud they need proper anti-fraud solutions. Businesses are now in need of user authentication services more than ever. Such services can take the form of identity verification services, single or multi-factor authentications and face verification services. Industries more prone to fraud have been implementing such solutions for a while now. However, some industries where fraud prevention techniques are gaining prominence include;

Cryptocurrency Sector

Conventional banking has always been ailed by fraud and scams. But since the crypto industry is a relatively new find, and more or less employs the same methods as traditional financing, it has also been affected heavily by fraudulent activities. Due to its primary presence being on the web, crypto is more prone to cybercrime, wherein lies its need to employ cybersecurity measures. Authentication services are the best solution to counter such threats. Their need for such solutions has led the crypto industry to KYC verification service providers. Due to the nature of their business, they also look for AML compliance measures which allow them to avoid financial and white-collar criminals.

E-Commerce Industry

Fraud in the e-commerce sector is not new. However, online retailers have had to bear the brunt of fraudulent activities from both the customer and the banks involved in their transactions. Therefore, proper verification of their customers has had immense advantages for them. Fraud prevention measures allow them to verify the customers’ addresses, thereby ensuring that they are selling to the right person and make sure that they do not have to face any chargebacks.

Travel and Hospitality Sector

One victim of identity and credit card fraud is the travel and hospitality sector. Scammers are widely known to steal identities to use for travelling and availing hospitality services. With fraud protection services now being provided by some companies, Hotels and airlines can make sure that all bookings and reservations made with them are from authentic customers rather than fraudsters or scammers looking to avail travelling and lodging services from a stolen ID or credit card.

Online Gaming Industry

Online Gaming has been emerging as a major player in the market gradually over the years. With the growth of advancement in the tech industry, gaming has also evolved into a significant revenue generating industry. The industry is no less fraught by scams and has been in need of fraud protection. Moreover, the gaming industry is also in need of age regulation, thereby requiring age verification of its users. Therefore, implementing ID verification and face verification services from a reliable identity verification service provider, they can ensure safe business practices.

Real Estate

The real estate industry is also known to be scammed by buyers, instead of the situation only running the other way round. Scammers usually target real estate businesses by providing fake financial details and a shady story into why they wish to buy an estate. Such scams can be avoided altogether by the real industry by implementing Know Your Customer (KYC) verification solutions. They ensure the business that their buyer is authentic and is providing legitimate details into his/her financials.

When it comes to identity verification services, Shufti Pro is a veteran in the market providing top of the line anti-fraud solutions to businesses, enabling them to ensure the ingenuity of their customers. Shufti Pro provides both KYC verification services as well as AML compliance to businesses through its state of the art AI-based authentication protocols.  It can be easily integrated into a business’s existing interface and is supported by all major web browsers in addition to having SDK integration for Android and iOS.

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fraud prevention tips

4 Fraud prevention tips that you must follow this Holiday Season

The holiday season is around the corner and it is the time of the year when online shopping and more specifically Christmas online shopping is at its peak. Christmas celebration coincides with millions of people using the occasion to make purchases from stores that have designed special sales and product lines for Xmas festival. But despite being a joyous occasion, the holiday season that ranges between Thanksgiving and Christmas is plagued by frequent identity frauds to perform online shopping. These identity frauds are performed by a number of means that can be in the form of account takeover and even by the use of fake identity credentials. Fraud prevention is an important responsibility not only on part of the individual shopper but on the part of businesses as well.

Why Fraud Prevention is Important?

Every year, online shopping spree attracts a large number of scammers and fraudsters that want to earn a quick buck from the frenzy surrounding the Christmas shopping. But interestingly, the increase in fraud attempts is far higher than the increase in transactions performed during Xmas festival.

Christmas online shopping sees people performing 19% more online transactions than yearly average but online frauds rise 22% higher than usual attempts of performing an online fraud during the same period.

Fraud Prevention Tips

Businesses as well as individual shoppers that want to benefit from the amazing deals of Christmas online shopping, fraud prevention tips can be really beneficial.

  1. Avoid Using Public Wi-Fi

There is no easier method than stealing important identity information from devices connected to Public Wi-Fi. So no matter, how tempted you feel to connect to the Wi-Fi of  the shopping mall you are visiting or any other publically available Wi-Fi, never connect your digital devices (either smartphone or tablet) with these virtual connectivity hubs, especially in these festive days when an average crook is more interested in your personal information than your wallet.

  1. Safer Internet Browsing

You might not be too excited about online shopping discounts offered during the holiday season but that does not mean that you are fully safe from scammers and digital identity thieves. So you need to be extra careful in your internet browsing practices. Do not open an email from an address that you do not recognize and even if you find nothing alarming about the email address, refrain from unwantedly clicking on any link in that email, no matter how tempting it feels like.

Same goes for online websites. Never enter any of your personal information on a website that might belong to a genuine business or outlet but lacks necessary security layer. The easiest way to check for that is by looking at the Url of the page. If it starts with https:// then you are safe, otherwise run away.

  1. Secure Your Payments & Plastic Cards

Credit card skimming and ATM hijacking are the oldest tricks for stealing financial information of users. It is important that for an airtight fraud prevention, you remain cautious about using payment gateways. It will be easier to monitor your transaction records if you opt for real-time sign-up alerts and mobile SMS for everytime you perform a purchase using your credit card. Account takeover is surpassing conventional forms of identity theft and best identity theft protection can be availed by doing the simple things right.

 

  1. Powerful Anti-Fraud Solution

Businesses that are looking to avoid a substantial loss of revenue despite a successful holiday season, should get in touch with fraud protection services. There are many identity verification solutions that can come handy not only for Christmas online shopping but for walk-in customers at multiple retail outlets. Mind you that online ID verification and best identity theft protection is not just needed by businesses offering retail items for sale during the holiday season. As described in the above infographic, industries as diverse as cryptocurrency and financial services experience a larger number of identity theft attempts during the holiday season.

Shufti Pro is a reliable option for businesses that want the support of a reliable fraud protection service, this holiday season. As a universally accessible anti-fraud solution, Shufti Pro can perform fraud detection with the help of its various online identity verification services such as ID verification, Face verification, Address Verification, and even credit card verification.

Online ID verification from Shufti Pro not only supports official ID cards but can also verify a person’s identity with the help of driving licenses as well as passports. Shufti Pro is available in 225+ countries and supports 150+ languages, making it the most appropriate fraud fighter for businesses around the globe. Real-Time verification results are forwarded to end-users as well as Shufti Pro customers to create a relationship of trust between businesses and consumers.

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8 Fraud Prevention Tips for a smooth business uptake in 2018

The Need for Fraud Prevention

As technology has evolved over the years, the way we do business has also evolved along with it. Whether it be to save money or to provide convenience to customers the use of technology brings along with it, its own pitfalls. The online business arena has become the target for the next generation of thieves and muggers. The risk of being robbed or ripped off that was once isolated to the streets and dark alleys of cities has made its way to the online world of the Internet. Hackers and even regular people have started exploiting the loopholes in the online transaction systems to carry out fraudulent activities, hence, the need for fraud prevention in the online business community has become essential. 

Illustrating this need with facts and figures will emphasize the point; according to a study by Javelin Strategy & Research it was found that in the US alone $16 billion dollars were stolen from 15.4 million consumers in 2016 through fraudulent means.  You can imagine the amount of trust problems and chargebacks the online business community might have had to face.

Online Scams Businesses Should be Cautious Of

Although new types of extortion schemes and scams come up as technology advances and more loopholes are discovered everyday, the majority of the scams that afflict online businesses can be summed up by the following — identity theft, credit card misuse, document forgery and the friendly foe dilemma. By ensuring a safeguard against these, merchants can easily secure fraud prevention. Here’s  a quick read:

Identity Theft – Hackers, and in some cases people in general, take on the identity or persona of someone else by hacking or stealing personal documents of another person and use it to gain access to certain services or to carry out financial transactions. A staggering 44% i.e. 1,357,055 people complained about identity theft in 2016.

Credit Card Misuse – Getting access to someone’s credit card information via coercive methods or by hacking. This by far more common then people would expect, given that there are so many checks by banks and financial institutions. The most common place it is used is online since POS and face-to-face transactions have become difficult due to measures taken by issuers of these cards.

Document Forgery –  The creation of fake documents be they financial or related to a company’s services or to the government. These are still taking place and have been used in situations such as tax evasion, account opening and increasing credit score.

The Friendly Foe – Mind boggling as it seems, normal everyday people have known to carry out this type of scam, just because there was a loophole that was available for them to exploit.  In this type of scam individuals carry out online transactions through their credit or debit cards and then once they receive their goods or are done using a service they report it as an unauthorized transaction that they did not carry out, resulting in charge-backs to the business that provided the service or goods.

The 8 Fraud Prevention Essential Tips

Having mentioned the major types of scams and frauds going around it makes things look bleak for online businesses. Yet, businesses that have employed strict measures to counter such risks have been successful. Some e-commerce sites that are making use of the easy and automated risk mitigation systems are able to bring down their losses to less that 1% of their sales which makes carrying out online business quite feasible and profitable.  Remember, scammers are smart but not quick enough.

Keeping this in mind below are 8 essential tips for fraud prevention:

Scrutinise the payment methods – As an online retailer you need to know the types of payment methods and their pros and cons in terms of your business. For example regular credit cards (AMEX) tend to favour the cardholder in disputes (chargebacks sound familiar)? But they are still the most widely used payment method and you do have to look at the convenience of your customer. Paypal on the other hand is a more merchant friendly option and has advanced scam protection features and advanced machine learning capability that actively works to mitigate scam risk. On the other hand Paypal also authorises chargebacks it’s not totally fool proof. Cryptocurrencies are another popular payment method; the blockchain tech makes it nearly impossible for forced refunds and since there are records of all transactions it is undeniable by the customer. On the negative side the value of cryptocurrencies is quite volatile so what’s it worth today it might hold the same value the next day or it could be worth more.

Use the CVV2 Card Verification Code – If you have included Credit and Debit Card payments like most online vendors, then you must have this system incorporated in your online payment page. This 3 digit code is present on the back of the card and is not included in the magnetic strip making it difficult to carry out transactions via forged or duplicated cards.

Make use of AVS Codes –   Again another safety protocol through which you can verify if the billing address provided by the customer is the same as what the card issuer has on their file. Although a difference in the billing address does not necessarily mean a scam attempt but it should alert you to be more careful with this individual.

New-age Fraud Prevention Systems – Whereby technology has brought its own set of scams it has also provided a fighting tool against such risks. From manual searches and checks to automated AI based fraud prevention software. These 3rd party s/w providers give an array of scam busting options (real-time identity verification, document verification, background checks) that you can add to your arsenal to protect your business interests. The digital KYC services that these providers give are mostly foolproof and given the recording of any transactions they can be your proof of purchase in case of false charge-backs.

Recommended For You: Fraud Prevention through Secure Payment Processes

3-D Secure: A somewhat recent technological development, in this system a there is an added layer of confirmation and security to ensure that fraud related incidents are minimized. It includes or spans three domains, hence the name 3-D . The first one is the acquirer domain which represents the bank and the merchant to whom money is being paid. The second one is the issuer domain which represents the bank which issued the card being used. The last one is the Interoperability Domain this represents the infrastructure provided  by the card scheme, credit, debit, prepaid or other type of finance card, to support the 3-D Secure Protocol. This can be the Internet or a telecom service provider. For example a code could be sent to the customer’s registered cell phone number with issuer domain, and the customer would have to enter in the given code to proceed with the online transaction.

Call the Customer – Old but gold, this is still one of the most effective ways to weed out potential threats. You probably get the customer’s number when you’re getting their information (make it mandatory and not optional). Call them to see if the number is legit, are you able to get through? Does the number belong to the customer or to someone else?

Common Sense and Awareness – Awareness and using common sense is essential for the online vendor, you need to keep an eye out for anything that is out of the ordinary and if something triggers your intuition into thinking something doesn’t seem right. Give it attention don’t just mark it off as undue suspicion instead do a thorough check.

It’s ok to say No – As difficult and preposterous as it sounds to deny a customer. Take heed that if their credentials and other information point towards a threat then you will end up loosing way more than just your business if you go ahead with your business transaction. You will end up loosing your merchandise as well as the money you had received (charge-backs).

Here’s the harsh reality: Fraud and scam in online space is inventing and reinventing itself. There’s no stopping it. The Nilson Report states that since 1993 there has been a mounting 23% increase in e-Commerce fraud yearly. The rising number are putting online merchants at great risks. Identity theft protection services become essential when credit card and identity theft fraud is on its peak, especially during the two holiday seasons: Black Friday and Christmas. While everyone awaits Christmas gifts, online merchants dread charge-back notifications.

In Conclusion

Although the facts might seem contrary to a positive outlook on online transactions. E-commerce merchants in 2018 have a lot more options to fight potential risks compared to the previous years such as AI based fraud prevention software that keeps scanning for threats and learns about new ones on its own. A vigilant mindset and the best of risk mitigation technology will ensure that online merchants find their businesses going in profit.

icos and kyc compliance

ICOs and KYC Compliance

With the surge in digitalisation of payments and crowdfunding; the need to set proper standards for better and valid operations has lead to creation of terms like KYC compliance, especially under the new GDPR regulation.

Picture this, you’re watching TV and you come across a report on cryptocurrencies and they mention how Bitcoin and the blockchain technology behind it has created a whole new industry of cryptos. They talk about ICOs (Initial Coin Offerings) as the new way to fund your ideas and businesses. They also discuss how more and more businesses are using the blockchain to launch their own tokens/coins to fund their company. They also mention how individuals have used ICOs for crowdfunding their projects and ideas. This piques your interest and you search online about how ICOs work and how you can use it to fund your existing alternative energy business.  

Several months later and after employing many resources you finally get your token sale/ICO online. People like your idea of providing unique eco-friendly power solutions to the masses and also appreciate the fact that token holders will be eligible for various discounts. The token sale goes well and you are getting way more funding than you had expected. There are even talks that your coin will reach the exchanges in a couple of weeks. Life couldn’t be better and you more happier. Then one day you get a chargeback for a large sum of money, then you get another and another. You’re baffled as to how this could have happened. You investigate and find out that  the people who used the credit cards to buy the coins had actually used stolen cards and have provided false information. There is nothing you can do as you really have no solid proof of purchase. You realise that you have not taken any fraud prevention measures in the excitement and the fact that this is new technology; the securing part was overlooked.

You follow up with research regarding fraud in the crypto field and you realise that many ICOs had suffered from frauds. You come across KYC (Know Your Customer) process as a way to deter such fraudulent activity. As you go further you find that the Security and Exchanges Commission has also taken notice of this scamming activity. They are discussing KYC complaince related issues, policies that have been implemented within banks and financial institutions should also be in effect on ICOs. You also find that the opposite is also happening where a lot of fake ICOs are scamming people. You hear the SEC read out plausible ICO scam warning signs and asking people to trust those ICOs that have some sort of Know Your Customer service implemented. You shake your head in dismay, cursing yourself for missing out on such critical information and you start your search for a suitable identity verification service provider…

Is KYC Compliance that Important for an ICO?

The situation above, albeit a hypothetical one, is based on true incidents. Many ICOs as well as investors have suffered and millions of dollars worth of crypto scams have occurred.  The lack of proper policies and checks from governments and regulatory bodies has resulted in people exploiting these loopholes from both the ICO initiator and the investor side. Scams apart, the prospect of money laundering using cryptocurrency is on the rise. Any investor found guilty of money laundering, will put all entities involved under investigation including the ICO provider. Getting to the point under the AML (Anti-money laundering) policy a basic requirement is KYC. All banks and financial institutions have to comply and follow a proper Know Your Customer procedure.

Read More: AML & KYC Compliance: 5 Ways AI is Supporting the Fight Against Financial Crimes

Having mentioned the gravity of the situation that calls for the Know Your Customer solution, we’ll discuss what exactly it entails. Besides basic information such as — name, address, DOB, contact number, — it can also include occupation, sources of income, references, etc. The cherry on top is that there is a requirement of submitting documents to prove one’s identity as well as to verify that the rest of the provided information is correct. After seeing what this process covers, it is easy to understand why it is such an effective fraud prevention tool.

So How Can One Ensure KYC Compliance?

There are several ways to ensure compliance. If you have a product or service that makes it mandatory for a customer/client to walk-in to get registered or purchase the product/service. Then you can get all the documents and verifications done face to face. On the other hand if you have a system that provides online services or products similar to what we have in an ICO. Then the best bet would be to go for a third-party identity verification service provider. They take care of all your identity verification needs utilising the power of the Internet, the customer’s webcam or smartphone camera. The process is basically the same, the customer is asked to face the camera and then show the identity document in front of the camera. One by one he is asked to focus in on the picture, DOB, and ID number (if applicable). The software automatically checks for irregularities such as mismatch in picture and actual face. Also checks the documents for signs of tampering or forgery.

Great! But How to Choose the Right ID Verification Provider for KYC Compliance?

Good question. Most 3rd-party verifiers have an advanced AI at the backend that carries out all the checking. Then there are one’s that provide a hybrid system that includes the best of AI and the best of HI (Human Intelligence) in it. Once the AI verifies a candidate, people then reverify the result to check for any false positives. The Hybrid system is clearly better than just an AI based system. Also, speed is of the essence in this case, as nobody likes long complicated procedures and processes.  The verification speed should be in seconds not minutes and the process clearly defined and easy to understand. Another major factor to look out for is what other additional services are they offering. For example do they offer an online mode of verification besides an offline one? This allows you to give a certain degree of freedom to your customer if you wish to do so. Another extremely important thing to look for in a KYC service provider is are they up to date with the latest requirements in the industry? An example is the GDPR policy that is being implemented in the EU. If a company does not ensure compliance it could result in fines for both the service provider as well as the hiring company/organisation.

In Conclusion

Regardless of the business you run all aspects should be considered especially the worse case scenarios. A SWOT analysis is definite even if an idea or business seems fool proof it does not mean that is does not require a backup or in this case a fraud prevention software. With the updated regulations around the globe it has become necessary to adhere with KYC compliance especially if one deals with PII data and such.

 

Secure payment Processes

Fraud Prevention through Secure Payment Processes

Here’s a question, why do people always say things like  “the good days”? The fact is a number of people find that new technology and game changing ideas bring new problems, issues and dilemmas. In the good ol’ days you had to sweat more to get work done but it was simple and straightforward. Same is the case with fraud prevention and identity management.

To put this into perspective let us refer to the story of Jack, a website owner who has about had it with chargebacks due to the use of stolen credit cards. He runs a successful hardware store but he saw that some of his customers were preferring the online method where they could get the things delivered to their doorstep. He had an e-commerce website made to cater to the people who preferred to order online. Everything went smooth at first as he had included most of the safeguards such as a secure connection and the proper requirements and payment gateways to collect the payment from the customer. But when he started getting chargebacks that’s when out of frustration he referred to the statement above. He referenced the fact that at the store he had a couple of shoplifters which he caught eventually but never a payment fraud. He said he accepted cards, he could verify the signature on the back and sometimes the cards had pictures and he could match those. He even mentioned that once he found someone suspicious and politely asked them to pay in cash since the card machine was not working. He says with everything online what can one do? The person who used the stolen card gave a fake address and contact number. In this case how can a website owner secure themselves against a credit card scam?

Are Secure Payment Processes the Best Tool for Fraud Prevention?

In the scenario above, when we look at the argument, it seems that, yes, the old times were less complicated. New tech has brought its own set of problems, but with that, solutions for those problems were also found. The answer came in the form of third-party verifiers that vouched to provide secure payment processes. As mentioned in the scenario the website owner could not verify if the card actually belonged to the person who was using it. What if that were possible in the online world? The answer is yes, it is possible; these online verifiers use the World Wide Web, the customer’s webcam or smartphone camera and verify the details on the card by asking for proof of identity such as an ID card or passport. They match the names, the picture on the ID card/passport to the actual person’s face. If they all match up it Okays the transaction and allows it to proceed.

If you look at it from the perspective of the website owner this is just what the doctor ordered — a fraud prevention system. This is the solution to Jack’s online problem, besides that he also has a proof of purchase to dispute any false chargebacks as the verification service providers also give pictures of the verification or even a video of the entire process with the customer.

Can Secure Payment Processes Counter Money Laundering?

Another aspect that is equally important is that of money laundering. The governments of the world as well as all financial regulatory bodies don’t take lightly to money laundering. If a company, business or financial institution is found guilty of direct money laundering or even aiding and abetting then they are in a lot of trouble. Such businesses or financial institutions suffer heavy fines and even be closed down with prison-time for the owner depending on the severity of the money laundering case. Some companies that provide Secure Payment Processes also provide services that do background checks as well as the regular identity checks. Their system does a thorough check of databases of global watch-lists. They hold information regarding known and suspected money laundering individuals, groups, companies, etc. Known as a digital AML (Anti-money Laundering) service. Having onboard a company that provides both services — online identity verification and anti-money laundering — is truly a powerful fraud prevention system.

Jack Knows What He Needs to Do Now, but How to Choose the Right Company?

When Jack found about the companies that can offer a solution to his chargeback woes, he couldn’t be a happier man. When he went online, that’s when he started scratching his head seeing all the companies out there. Not knowing what things to look for can make choosing a good company a confusing and tedious task. Let us see what to look for in a good company that provides Secure Payment Processes.  The first thing to look for is speed and ease of use. If a process is too complex and takes too long, then people just lose interest that causes loss to the business. The best ID verifying companies have verification times in the seconds. Another thing is that most of the providers are powered by an advanced AI that does automated checks of the documents as well as picture and face matching. The better providers go a step further they add HI (Human Intelligence) to the AI. Live people check the results of the AI for false positives. The entire process by both AI and HI takes less than a minute. The features and options that a fraud prevention provider gives should be scrutinised as this makes it easier to judge if they are giving good value for money or not. Good providers allow for online as well as offline checking so that if a client wishes to offer their customers the ease of offline submission of documents and pictures they can do so. Also, if the provider offers digital AML services then that is definitely the cherry on top. The last but the most important thing to look for is if the company is compliant with the latest industry standards and policies. As partnering with non-compliant companies can result in heavy fines and other penalties for both the digital AML service provider as well as the company that has hired them. An example is the GDPR policy for companies that are handling the data of European citizens.

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online retail businesses

Fraud Protection services for Online Retail Businesses

Online Marketplace faces Chargeback issues

Fraud Protection Services are an integral part of retail businesses that are constantly looking out for fraudulent customers. They have to be wary of the consumers looking to dupe the retailers by making purchases and then demanding chargebacks. This can incur huge losses to online businesses and virtual retail markets.

Looking at these statistics, the question arises that how these scams are committed and how may they be prevented. Fraudulent customers may commit card-not-present frauds using stolen credit cards or illegally acquired details about someone’s accounts. In cases like these, it is essential that retailers install credit card fraud prevention services from a known provider. KYC compliance is the first and foremost step if this problem needs to be curbed.

What can be a feasible solution?

The most viable solution for this rapidly growing problem would be to avail quick and accurate business verification services, like Shufti Pro. This quick process allows the businesses to perform digital KYC, ensuring that the card indeed belongs to the person in possession of it. Moreover, a trust is developed between the regulars and the original business. The customer-base of the business will be assured that all clients are the true ones, and that the business is taking apt measures to make sure only true buyers can make a purchase. This will ensure a long life for the business, as risk of going out of business due to elevated chargeback frauds is minimised.

Shufti Pro acts as a sentinel against the false customers as well as a flare that indicates that the client pool of a company is clear of fraudsters and scammers. The secure business process will attract more consumers owing to a refined screening process that takes customers on-board.

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Kyc in Higher Education

Demand for KYC & ID Verification in Higher Education

I remember a friend of mine, Jack, from high school he was one of the most non-serious people I knew when it came to his education or studying for that matter. He had barely graduated, getting minimum marks in almost all subjects except art. Back when we were preparing for our A-Level examinations to get ready for college, he was thinking about having another person sit in his place for the exams. He said there was this person he knew that offered to sit the examinations in his place for a $1000 and said that he would get him a score in the upper percentile. He said he would take care of the ID as well; it will have his picture instead of Jack’s, but it would still have Jack’s name. He said they really don’t do an extensive ID Verification. He also offered services for passing entrance examinations of education institutes. The big day came and Jack was nowhere to be seen. A couple of months later I saw Jack jumping around, he brought over his result and it was exceptional and I asked him if he actually got this score or some else? He told me that of course he (Jack) did it and I was like yeah right. He never told me or confirmed if he had hired that person to be in his place. I told him that he wasn’t present there, he told me he had been assigned a different venue. Whether he actually cheated or not, he got in his preferred college and took up majors in Art. That I believe was the right choice for him…

Although the incident above can be considered a story it is based on true events. In fact a similar incident is documented from 2011 – CBSN (2011), Allison Stewart reported in her story, The Perfect News, that Sam Eshaghoff took the SATs for students, who paid him around $2500 each, to ace the examination in their place. He used fake IDs to appear in the test each time. In 2011, he was charged with fraud and criminal impersonation.

In another although fictional story 3 Idiots is a movie that is based on a real person; it depicts how one student was asked to take on the identity of another person since he was not that good in studies. Due to whatever circumstances who took on the identity of another individual and got an education while the engineering degree that he earned was in somebody’s else’s name. This also supposedly happened in one of the best universities of the nation.

Why ID Verification is Getting Essential for Educational Institutes?

The problem is that as competition increases more and more students might be tempted to take the easy way out. Searching for loopholes or laps in verification checks within education institutes they could succeed in such instances as the one mentioned above. That would be unfair to the students who worked hard for their own results. That is where the KYC (know your customer) process can prove invaluable. As universities and colleges begin to offer online courses this has become even more essential that before taking an examination the prospective candidate go through an e-KYC process that would include ID verification.

What Makes the KYC Process so Effective?

As mentioned in the previous paragraph the online examinations are becoming more common and in order to deter any sort of fraud or cheating an online KYC or e-KYC system proves invaluable. This system is usually offered by 3rd parties and is based on a highly advanced AI system that sometimes has an extra check done by HI (Human Intelligence) to ensure that everything is correct. The system uses the webcam or the smartphone camera of the candidate and asks them before the examination starts to verify their identity. They ask the individual to face the camera and then show the examination slip (if given) and their ID card. The system then matches the details mentioned in the slip with those on the ID Card and those already fed into the system. It can check for tampering with documents and also highlight forgeries. It also checks the face of the candidate to see if it matches the picture they have on file. The system is smart enough to take into account glasses, facial hair, etc. Once the ID verification is done the individual can proceed with the examination provided there were no discrepancies. The webcam ensures that there is no switch of people  afterwards.

What to Look for in a Good ID Verification System?

Having mentioned how digital KYC can help educational institutes deter cheating. It would be wise to discuss which aspects one should look for when deciding on getting a digital verification system on board. The first thing to look for is speed and ease of use. The process shouldn’t be too difficult to understand or take too long. The best companies have verification times in the seconds. Another thing is that most of the providers are powered by an advanced AI that does automated checks of the documents as well as picture and face matching. The good ones offer a hybrid system that adds HI to the AI. Live people check the results that the AI has given to make sure everything is in order.  One of the most important things to look for is if the company providing the verification system is aware and up-to-date with the latest industry requirements. As partnering with non-compliant companies can result in heavy fines and other penalties. An example is the GDPR policy for companies and institutions that are handling the information of European residents/citizens.

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insurance fraud prevention

Why Digital KYC is Important for Insurance Fraud Prevention

KYC For Insurance Companies : Basically, a system that can carry out real-time identity verification, background checks, and detect possible forgeries in documents. Such systems exist in the form of digital KYC service providers.

Insurance fraud is a stark reality and many people who commit such frauds do not realise that their actions result in higher premium rates that have to be paid by other people. On average, insurance companies lose around $30 Billion a year due to fraud. The costs of these frauds are borne by honest, hard-working people. There is an urgent need for fraud prevention systems in the insurance industry. Although, there are insurance investigators that work in high-profile cases and also the cost of carrying out an investigation is borne by the good honest people. 

Moreover, it is the smaller cases that cause the most harm as they are ignored and add up to become a hefty amount. Although background checks are usually done in the insurance industry and they should be, as they can help point out money launderers, if not the fraudsters. The reason is that most people who carry out insurance fraud rely on fake or stolen identities to carry out their scams. Secure processes that are fraud-proof is the need of the hour. as we proceed with the article we will discuss how KYC services providers can assist the insurance industry. We will also discuss the things to look for when searching for such a service provider.

Frauds That can be Stopped Through Secure Processes : KYC For Insurance 

Although there are many types of frauds that happen with insurance companies, yet there are some that can be easily avoided by applying secure processes.

Fronting: In this type of fraud the insurance policy is taken out using the details of another person to get favourable terms such as lower rates on premiums. Criminals or fraudsters usually rely on this method to carry out their fraudulent activities. They use fake or stolen identities to present themselves as someone else and create fake documents to support their taken identity. KYC service providers can easily weed out such attempts and prevent them from happening.

Money Laundering: is a global problem. Insurance companies too are frequently targeted to launder money. The products offered by insurance companies and the processes that are associated with them make it easy for money laundering. Life insurance policies are extremely lucrative to money launderers as they allow for large premium deposits. Money Launderers take out such policies and deposit large amounts of money while cancelling the policies after a while. They do suffer some loss but the amount they receive back is effectively laundered. KYC service providers that allow for background checks can help curtail these types of frauds.

How Digital KYC Services Ensure Fraud Prevention

Digital KYC service providers rely on state-of-the-art AI to carry out multiple checks. The software that can be integrated with all known systems. It uses the Internet, a webcam or a smartphone camera to carry out its verifications and background checks.

In the case of fronting, this would prove an invaluable tool. The process of verifying a person for a policy would include;

  • The person wishing to acquire a certain policy would fill out the required information and after submitting it would be redirected by the verification system. 
  • The person is asked to present proof of identity documents in front of the camera and to focus one by one on the required verification parameter such as name, DOB, address, etc. 
  • The AI checks the documents for signs of tampering or forgery. The picture is matched with the face of the person and the data is matched with the provided data that the customer submitted initially. The entire process is recorded and done in less than a minute.
  • There they would be asked to face their webcam or their smartphone selfie camera after getting a special link. 
  • The 

In the case of fraud prevention related to money laundering, the process would be the same. But if the company has opted for AML (Anti Money Laundering) screening checks then the AI would simultaneously check thousands of global watchlists for any sign of money laundering suspicion or prior conviction.

What to look for in a Good Digital KYC Services Provider?

Having mentioned the value of verification services it must be said that not all companies offering fraud prevention services are the same. Companies understand that customers do not like long waiting times or lengthy onboarding processes. This is why it is important that insurance providers take on a KYC service provider that is efficient as well as effective. 

Shufti Pro’s digital KYC solution implements advanced machine learning and AI systems to catch documentation fraud, identity theft and offers liveness detection. It offers a hybrid solution that includes a backup of human intelligence along with the AI that verifies the results from the AI for false positives. This lends more accuracy to the entire process and all this is done in seconds as well.

Real Estate Industry Kyc

Fraud Prevention in Real Estate Industry

Fraud prevention tools that include3rd-party KYC service providers are essential in the real estate industry to elaborate what we mean. Please imagine this: you’re living cosily in your house. You’ve had it for quite some time. You bought it using the money that you received in your inheritance. It has a decent market value and you’re fortunate to not have any mortgages or loans to pay. One day you get up and you go out to check your mail. There is a mail for you from a real estate company that you have never heard of. You open it up thinking it must be an ad or something, but it’s actually a letter addressed to you. As you read through it you get a serious expression on your face and your heart starts to race. You think this has to be some mistake or a misunderstanding. You call the real estate company and ask to speak to the person mentioned in the letter. You tell him your name and he tells you that you have missed out on your mortgage payment for the first month. You tell him that you never applied for any such mortgage on your property. He says you signed the agreements and everything. You tell him that you would like to meet up and he agrees and you go to the address mentioned on the letter. When you reach the place you ask the secretary to direct you to the person whom you spoke with. You enter in his office and the person sitting behind the desk inquires as to how he can help you? You tell him your name,  and tell him you spoke on the phone with him. He suddenly loses the smile on his face and with a serious look inquires if this is a joke. You tell him that you almost fainted when you saw the letter. He says the man he processed the mortgage for was younger and a totally different person. You show him your ID and then he is the one who looks like he is going to faint. You have just become a victim of title fraud, you wonder why didn’t the real estate company do any background checks.

Luckily you have title insurance, although you never thought it would be required…

Another reason for the checks is that the real estate industry is a very lucrative and high equity business. This fact is something that in itself attracts a lot of people to invest in it. Sometimes not all the investor are good. Some plan to launder their money for use in criminal activities or even terrorism. Hence, AML/CFT (Anti-money Laundering/Combating Finance of Terrorism) compliance is imperative.

Are KYC Service Providers the Ideal Fraud Prevention Tool?

The incident above is a plausible scenario and a KYC process including a thorough background check would’ve actually stopped this from happening in the first place. These days real estate agents and companies can hire third party KYC service providers to help with their verification needs. These 3rd-party services providers use advanced AI that not only simplifies the entire process but also makes it extremely fast. The SaaS software integrates with almost all systems. The AI uses the power of the Internet, a webcam or a smartphone camera to carry out its KYC procedure. Let us explain using the fraud scenario mentioned above. When a client comes in for a mortgage they are asked to fill in an online form. Once the form is filled the KYC provider SaaS software kicks in and informs the customer of the process and also that the session will be recorded. Then it asks the individual to face the camera or, if one is not available, sends a link on their smartphone so that they can use their selfie cam. The AI checks for anything that would alter their face or hide it, such as excessive makeup, a mask, or using of a picture instead of showing their live face. The system is advanced enough to account for facial hair, glasses, jewellery and hair cuts. After that the system asks the person to show their ID on the camera and asks them to focus on their picture, name, DOB, and number (if applicable). The AI then matches the picture with the face and checks for signs of tampering or forgery on the ID. During this time the AI also carries out a background check. It searches global watchlists for finding any mention of fraud, money laundering or any links with terrorist organisations; thus ensuring compliance with AML/CFT rules and regulations. If everything checks out  then the system gives the go-ahead for the processing of the mortgage request. All these properties make KYC service providers an effective and efficient fraud prevention tool.

What to Look for in a Good Fraud Protection Tool?

Not all KYC service providers are the same, so we’re mentioning somethings that will make it easy for you to search out a good fraud prevention tool.

The most important  point is to make sure that the company you are selecting is compliant with all rules and regulations in the industry as lack of compliance can result in heavy fines for the company as well as the real estate business. The other important factors is speed. As people get tend to pass on long and time consuming processes that are complicated. Keeping this issue in mind, most good companies do verifications in seconds and provide easy-to-follow instructions. The background checks the system carries out is done simultaneously so it is also processed within the same time frame.

Almost all KYC service providers offer advanced AI solutions, but the good ones offer an adder layer of verification which is done by HI (people). Once the AI gives a verdict it is verified by live people to ensure there are no false positives. The entire process is completed in less than a minute.

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Health Care Industry

How AI is Transforming Fraud Prevention in the Healthcare Industry

KYC For HealthCare: Fraud is so common that there is hardly any industry that hasn’t had to bear the brunt of it. The health care industry is no exception to fraud. Medical identity fraud has some of the worst impacts on a person’s life. The financial shock alone is enough to be devastating for the victim. The emotional shock, on top of that, is significant when a person gets their medical identity stolen. The medical institution itself faces problems due to the type of fraud discussed herein. Medical identity theft is rising fast and becoming a concern for both patients and healthcare providers. However, modern technology has transformed fraud prevention in healthcare and is enabling the fight against fraud significantly. 

In the past few years, medical identity theft has risen significantly. In 2016, around 10% of the US population had their medical data compromised. Due in part to the fact that the number of data breaches in the past few years has increased exponentially. Healthcare data fetches at least 10 to 20 times more on the black market than normal identity credentials. This makes medical data more appealing for hackers and cybercriminals. The primary reason being the fact that medical records contain more information than other identity documents, including name, DOB, SSN and insurance information. What is worse is the fact that is harder to detect as it can go unnoticed until a person needs medical services. 

Source: Experian

Fraud in the healthcare industry via impersonating a person is something where some people even go so far as to copy credit cards of another person and make payments using them. Fraudsters are also known to use medical insurance details of a person to obtain healthcare benefits or buy prescription drugs. Any of these situations can prove to be seriously harmful to the victim. Not to mention that it can cause grave damage to a person’s reputation. 

Using AI for Fraud Prevention in Healthcare

Where AI has made immense progress over the years, it has also managed to improve fraud prevention systems. The same fraud prevention systems can be used to address fraud in healthcare systems. There are a number of third-party identity verification service provider. These digital KYC systems use advanced AI and HI (Human Intelligence) to pick up fraudulent attempts.

Online identity verification services authenticate individual users through document and facial verification techniques. This allows them to determine if a person is using fake or stolen credentials and thwart their attempts to defraud the system. 

How Do Fraud Prevention Systems Work?

Third-party fraud prevention solutions like Shufti Pro rely on AI and HI to look out for false positives. Simple access to the internet, a web camera or a smartphone camera enables users to carry out an identity verification check. The hospital staff simply would have requested the patient to use the camera to verify their ID and/or insurance card, while authenticating them by using facial verification.

Fraud can be prevented by us being a little more vigilant and careful with our personal information. At the same time, the various institutions that provide healthcare and handle payments need to be a bit more strict with their KYC processes. They can third-party verifiers effectively to their advantage to build fraud prevention in healthcare systems.

Shufti Pro Still Verification

Shufti Pro’s® ‘Still Verification’ Feature Enhances Customisation for KYC Services

 

Demand for enhanced fraud prevention, increased flexibility to customise, improved customer credibility without integration of our API led the team to develop Still Verification feature

BATH, United Kingdom – October, 2017 – Splendid squad at Shufti Pro® outperforms once again as the members join heads to bring the Still Verification feature, for ‘offline’ ID verification. to light in the recently developed SaaS. Shufti Pro announced today that clients who do not wish to integrate their API with their systems but still want to avail their services have gotten prayers answered. Shufti Pro’s developers realised the security and confidentiality concerns expressed by their clients, and responded by efficiently and effectively creating a customised category of the service for their apprehensive patrons.

The talented team has come up with a secure identity verification service that allows their clients to securely share their customer’s document image or video of customer’s face plus documents through Shufti Pro’s API, without any integration requirements. The said SaaS verifies them in real-time, with the same authentication stretch of 30 seconds. This feature is termed Still Verification and brings a revolution in the digital Know Your Customer (KYC)  realm. It has never been easier for our clients to verify their customers without a direct third-party inclusion.

Customer experience is not only enhanced but a trust and credibility is also developed between them and the clients. Shufti Pro is ecstatic to bridge the gap between concerned regulars and a seamless experience. Consumers can trust their clients without any hesitation of giving away their sensitive information to an unfamiliar entity. Shufti Pro seemingly steps out of the scene and remains active at the backend, performing accurate and efficient online identity checks for their clients.

Online businesses and merchants, financial institutions, etc. can easily comply with emerging KYC compliance directives without worrying about security breaches and confidentiality violation. Still Verification serves to ease the trepidations of the users by allowing all their data to directly reach the clients. Shufti Pro is the hallmark of e-KYC and customer satisfaction in the industry and hopes to keep advancing their services to meet the needs of their consumers.