ID verification - Shufti Pro

Intelligent Security Systems & Digital ID Verification

Most technology solutions present a compromise between convenience and security to their users. In that, as a system is made more secure, it becomes harder and harder for users to access. This tradeoff has become somewhat of a challenge for different businesses as they seek to provide both attributes in all their digital channels for customers. The e-commerce sector, for instance, faces the repercussions of credit card fraud or identity theft in the form of chargebacks and fines. Digital ID verification solutions present themselves as the ultimate solution where companies no longer have to compromise on accessibility while providing security to customers.

Every organisation today faces the challenge of digitising its operations to provide fast and easy access to services to customers. Whether it is developing multiple channels to engage customers or providing secure payment channels for online buyers, businesses are constantly establishing better IT systems to increase convenience for customers. With the rise and progression in technologies like Artificial Intelligence and the Internet of Things, the IT industry has been able to develop solutions that are both efficient as well as secure.

AI systems are being constantly refined and are able to learn from their own experiences. They are being made to perform redundant tasks, suggest the best course of action and minimise risks for the company. With the increased advancement in intelligent systems, businesses can now implement systems that are able to verify users in real-time, all the while lending better security to transactions.

The Problem With Present ID Verification Systems

The prevalent verification systems in businesses are outdated, manual or both. They have become stagnant and inefficient in the wake of increased sophistication in the landscape of fraud. Businesses and financial institutions still rely on stagnant data sources, that makes it harder to achieve accuracy in identity verification. As the increased usage of social media has rendered personally identifiable information or PII vulnerable, businesses must come up with data sources that are more reliable and can establish the true identity of an individual.

Manual verification procedures tend to be prone to error, not to mention time-consuming. Banks have long relied on manual, in-person verifications for clients. Online businesses, on the other hand, had no such verification tools to authenticate their users. The outdated systems that have been used for customer identification and verification are no longer efficient and reliable. They operate on outdated and rule-based systems and, thus are prone to generating false positives. As the staff members sift through false leads, they get to legitimate leads belatedly, thus giving fraudsters the opportunity to get away with their scam.


Building Intelligent Security Systems Through Digital ID Verification

As the landscape of technology progresses at a rapid pace, systems have been developed using modern technologies including AI. Big data analytics and the IoT that can eliminate the construct of inefficiency in its entirety. The digital age has given rise to intelligent security systems that allow companies to curb crimes like identity theft, credit card fraud and money laundering. Systems are available for fraud detection through online ID verification and risk appraisal of customers.

An ID verification software allows businesses to identify and authenticate a customer’s identity within seconds. An identity verification service like Shufti Pro is capable of verifying users through document scanning and facial recognition online. Users are able to establish the authenticity of their identity through the former and proceed to verify themselves with the latter.

Another efficient tech solution for fraud detection is the risk analysis of customers through advanced machine learning-based algorithms.  A risk analysis software is able to detect suspicious activity amongst a client’s transaction history, thus enabling the organisation to detect and prevent fraudulent activity as it happens.

Industries Using Smart Security Systems

Fraud detection and security solutions have a vast array of applications for different industries. Some of the industries where modern technology has helped in revolutionising security include;

  • Healthcare

    The safety of medical records is of the utmost importance in the healthcare industry. Medical identity theft has become more common and prevalent than people care to realise.  With advanced AI-based systems, it is possible to secure these records. There are now systems available wherein doctors can retrieve medical data of their patient through their identity bracelets. Through real-time identity verification, healthcare providers can verify the information of patients thus preventing identity theft.

  • Financial Services

    Financial services industry has long relied on manual methods for client verifications. Through an online ID verification service, they can authenticate a client’s credentials in real-time thus increasing accuracy as well as the efficiency of the process. Transaction monitoring systems can detect threats instantly thus making sure that the bank can deter fraudulent activity.

  • Freelance Economy

    Platforms like ride-hailing services and online consumer to consumer buying platforms also require a certain level of trust among its customers before they can use them. These businesses can increase the levels of trust among its users through online ID verification services.

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document verification fraudulent

Document Verification Services for a Secure Freelance Platform

Picture this you have recently started a freelance website you have marketed it properly and followed through on all steps to make it popular. It’s going good, you have a decent number of people posting projects and a decent number of freelancers who are able to complete them. You really haven’t had any problems, you are the middle man and you just take a small commission from both the project owner and the freelancer. The entire system is automated so you really don’t have to do a lot. Then something like this happens — you see a chargeback and its for quite an amount. You search out what the issue is and find that a freelancer has not completed his task and has also taken some amount in advance. You try contacting the freelancer to get an update but the number is turned off and you haven’t received responses to your email. You take it as a one off and refund the project owner and don’t really take any action except for disabling the freelancers account. Guess what a few weeks later you get multiple chargebacks, all for the reason that the work had not been completed. All of the freelancers had taken an amount in advance. You are worried now, the previous project owner who requested the chargeback was quite angry and did not post any other projects. You also tried contacting the freelancers but as before there was no response. Your website is getting a bad repute online and the number of tasks being posted has declined. You think about stopping the advance payment option, but argue the fact that good resources as well as certain tasks require some amount in advance and plus you made your entire marketing campaign around this. You frantically search the web for a solution, you come across an article called “ Document Verification for a Secure Freelance Platform” You start reading it and as you go through it you realise what’s been happening with your website is freelance fraud. With tears of joy in your eyes you know your prayer’s have been answered and you say to yourself “I have found the solution to my problems…“

Deterring Freelance Fraud with Document Verification

Although the above paragraph is about a hypothetical situation but still the threat is very much real, it is something that can and has happened in one form or another. So the question arises how can one prevent such a fraud from ever occurring? To answer that we need to see what was the cause for the freelance fraud in the first place. In the hypothetical case above the freelancer site probably had a registration process that a freelancer was required to fill out plus they have to make a profile detailing their expertise. That is pretty standard but there is no way to verify that the person claiming to be that freelancer is actually them, no document verification to ensure their credentials are true and real. Given that in this platform the freelancer was allowed to take something in advance it set the stage for someone to exploit this feature. The person or people involved in this fraud probably created false identities knowing that there is no check and uploaded impressive credentials and mentioned great skills. The idea itself was great and would likely attract the best of the best to apply as freelancers. This in turn would attract people or organisations who wish to get their tasks done by highly-skilled workers. The only drawback was, it was not thought through properly and did not have a deterrent to avoid this kind of fraud. The deterrent in this case could have been a 3rd-party digital KYC or an identity verification service — something that could verify the credentials and documents to prove that the freelancer is truly who they say they are.  Later in the article we’ll look at a solution and the features such a solution have.

Freelance Scam – Another Situation

Before we go on and discuss the solution to this problem it would be good to mention the same could also work to prevent another type of Freelance Scam. This would be the opposite of what happened in the hypothetical situation above, it could be quite possible that the platform itself that is providing the freelance service turns out to be a scam. This would not only affect the freelancer but also the company or individual providing the projects. Supposing that the freelance service offers an escrow meaning they keep the money until the task is completed. What if they in the end after getting all the money do a disappearing act similar to the one’s that ICOs are pulling off? What would be something that would prove that they are the real deal and not some scam? The answer is that they probably would have invested in some third party service that ensures they are compliant with KYC rules and regulations and that they are serious about who’s joining up with them. In an absence of sound Document Verification mechanism; your platform is always at risk.

So is Document Verification by a Third-Party the Answer?

The answer is a big YES, the fact that nothing adds credibility to one business or in this case freelance platform is the investment they put in to it; it shows the company is against freelance scams. Not only that but since everyone who is on boarding as a freelancer is verified through their documents. The documents are sent over to the third-party verifier and checked for signs of tampering and forgery. Their pictures are matched with those on their ID cards and checked for irregularities. The great part is that verifications can be done live using a webcam or by submission documents. The whole process takes less than a minute. So they know if they try to pull a fast one they can be highlighted and criminally prosecuted as well.  This is one of the most effective deterrents of freelance fraud.

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Protect For Charity Against Fraud

Know Your Customer Verification for Charity Organisations

They say no good deed goes unpunished, if we were to take a look at it literally the frauds that happen to legit charity organisations are the perfect example. It is hard to believe that scammers would do such a thing, but sadly it does happen. As is with most charity organisations they don’t think that someone would do such a thing with them, but the truth is far from it. Besides the threat of fraud, charities also need to be aware of individuals or companies that might use the platform of the charity organisation to launder money. In this article we will look at the warning signs that charities need to be aware of and what role Know Your Customer Verification (KYC) can play in protecting these organisations from fraud. We will also look at how charity organisations can prove themselves credible. Fraud prevention is not just limited to charity organisations as the opposite is also a concern, where the hard earned money of good people is swindled by fake charities. We will see how  the process of identity verification can add to the credibility of a charity.

So How Do Donors Cheat a Charity Organisation?

There are two main ways that charity organisations are cheated by fraudulent donors. Although there are other ways as well. Also fraudsters are always concocting a new way cheat people an organisations. The first one involves the use of a fraudulent check. In it a donor reaches out to a charity organisation and shows their willingness to donate a large sum of money. After the initial contact the donor mails in the check for the large amount. After a very short time, the donor contacts the charity requesting a full or partial refund of the donated amount. The reason that is given is usually a very severe or emotional one, such as expense for a sick person or other emergency case. If the charity in concern refunds the amount before the bank gets back to them regarding the fake check, the charity is at loss. They will also be responsible for any bank related fees and charges.

The second way fraud is done against charities is through the use of credit cards. A donor approaches a charity organisation and requests to donate a large sum of money but with a condition. The condition being that a percentage of the amount will be donated to another foreign charity organisation. The foreign bank account of this charity organisation is actually the account of the donor. If the charity accepts the condition then they going to lose a lot. As in this case, the credit card used to make the transaction is usually stolen. The charity will solely be responsible for any chargebacks and it will have unintentionally partaken in a money laundering scheme.

Money is a powerful motivational factor and seeing a lucrative amount charities like other organisations are tempted to accept weird conditions. If only a simple identity verification service had been used; it could have thwarted these attempts. We’ll elaborate how later in the article.

So What Should Charity Organisations Look out For?

  • Large one-off amounts or a number of smaller amounts that are donated and no source can be checked by the charity.
  • Conditions where the charity is required to do something such as transferring of a certain amount to another charity.
  • If the charity is asked to keep a large amount/donation for a specified time period. After the short period the amount is to be returned to the donar. Usually charities find the attraction of keeping any interest that is earned while they are in hold of the money.
  • If the donation being made is in a foreign currency and there are conditions attached with the donation that the original sum is to be returned to the donor in a different currency.
  • if the charity is asked to provide privileged services and benefits to the donor and or a person or organisation nominated by the donor.

So how do Know Your Customer and Other Identity Verification Services help fraud prevention for Charity Organisations?

As mentioned previously a simple identity verification can thwart most fraud attempts. The simple fact is that when all credentials are verified and a proof of identity is asked to confirm that the donor is actually who they say they are. Most fraudsters back off out of fear of being caught. This verification is an integral part of the Know Your Customer policy that financial institutions such as banks follow. Some charity organisations argue that the system is workable for walk-in donors and not for their online donation platform, hence, it is not an effective fraud prevention process. The truth is far from it; there are 3rd party platforms that allow for online verification. The software can easily be integrated with any existing system. Using the webcam or even the smartphone camera of the donor the system can verify the authenticity of documents that are used to prove identity. It includes face matching and checks for any tampering and forgery. If something negative is detected the charity will know about it immediately. At the heart of the system is an advance AI that carries out the checks and then the result is reverified by Human Intelligence, whereby people check for any false positives. The entire process takes less than a minute.

Great! But how does Identity Verification or Know Your Service add Credibility to a Charity Organisation?

Good question, as we discussed the opposite is also true that there are fake charities that swindle good people out of their money. In fact this type of fraud is also quite high, charities collect the money and then pull a disappearing act. They are never heard from again and the cause for which they collected is never addressed. So people are also look out for warning signs regarding charity scams.

One thing that is common with charity scams is that they really don’t care where the money is coming from. They just want the money without concern for the source and would not definitely think about investing money in a verification solution. When a charity comes along with a 3rd-party Know Your Customer service it immediately tells the donor that this charity is serious about their donors and the money they are getting. Plus the simple fact that a charity is spending from its pocket to ensure compliance with Know Your Customer rules and for fraud prevention shows that it is there for the long haul.

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Digital KYC Streamlines Customer On-boarding Process

Shufti Pro brings forth digital KYC verification services to perform identity verification processes in order to bring the customers on-board. We understand that it is not only a hassle for your customer, but for you (our client) too.

Why conventions need to change?

Quick and secure identity verification service has rendered the traditional practices obsolete, where customers had to go through lengthy processes, fill out numerous forms, and wait in line for hours just to comply with the KYC requirements. The results of their verification would be processed over weeks, delaying the on-boarding process further. Customer on-boarding process is not only essential for financial institutions like banks, investment firms, insurance agencies, real-estate agencies, etc., but also for online businesses and merchants. The online businesses cannot afford to carry out such thorough documentation just to bring a customer on-board. They make use of knowledge-based verification, which is in no way enough information to verify the identity of a person. Those questions have highly predictable answers. Much higher complexity in security procedures would be required to keep the scammers out. They need a quicker, smarter and automated solution or else face the fraudsters.

Moreover, many of the customers work full-time jobs, and the timings coincide with the working hours of the banks/firms. It is not possible for customers to take that long a leave from their work just to stand in lines for the submission of their KYC documents. Also, paper-based KYC uses up valuable resources that could be put to better use.

What is the Optimal solution for change?

The most optimal solution for change is to integrate a digital KYC solution that verifies the identity of a customer in real-time. Shufti Pro is one of the best SaaS available as a fraud detection software. It allows for quick and real-time ID checks online, using artificial and human intelligence. Stats have shown that e-KYC reduces the customer on-boarding time by 90%. The process becomes much faster, efficient and accurate as the customer identity verification time reduces to 30 seconds. Now online businesses and financial institutions can verify the customers easily; the latter just have to show their face and identity documents to the camera and their identity would be verified. There would be no need to stand in line for hours and submit volumes of documents.

Fast and accurate on-boarding process through digital identity verification will result in a seamless customer experience, reduced hassle for the customers as well as the online businesses/merchants and financial institutions.

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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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Enhance Time Efficiency with Shufti Pro’s KYC Solution


The Past

Quick and secure e-KYC verification might not have been of importance in the days prior to this digital world as cyber security wasn’t much of an issue and customers were verified manually. They had to stand in long queues to wait for the person behind a desk to match their charming photo ID with their charming face, and that was the end of it. Then you had to wait for a few days until the results of your consumers’ KYC were posted so that you could go ahead and start taking them on board.

The present

Now, with most transactions happening online and businesses/merchants entering the global virtual marketplace, waiting for hours in line and then days to get the results back, is simply not acceptable. The nature of today’s business doesn’t allow for it. Shufti Pro provides digital identity verification servicesto these online businesses, and helps them to perform  KYC verification online in a matter of 30 seconds. Easing the lives of hundreds of clients as well as their customers, we have introduced a quick, real-time identity verification application that integrates with your mobile devices or PCs and helps you to carry out secure online transactions within seconds.

Shufti Pro allows for secure online identity checks that aid in fraud prevention and provides the best identity theft protection services to online businesses and merchants. It requires the user to simply present their face and legal documents to the camera while our artificial and human intelligence algorithms process the confirmation of their identity.

The Future

Expanding global companies can grow at a much faster rate by reducing the on-boarding time to the minimum. They can use Shufti Pro to make the process much faster and more efficient by performing ID checks online. It is a simple, hassle-free process, and easily accessible by their customers. The reduced time and cost, plus increased performance is a massive saving and a boost for company-growth. You (our clients) can continue to enhance and grow your business with the peace of mind of knowing that any attempts by fraudulent users will be thwarted, while we also provide you with what you need in the e-KYC and AML compliant milieu, bereft of any security concerns.

Shufti Pro operates globally in over 200 countries and supports over 150 languages. It can definitely serve as a guardian at your door, regardless of where you’re located in the world.

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Fraud Prevention Fintech Industry

Fraud Prevention in Fintech Industry

The FinTech industry has really made its mark in the last couple of years. FinTechs have been providing financial institutions such as banks, insurance companies, brokerages, etc., technology to ensure efficient and accurate handling and management of their financial aspects. These have been in the form of new softwares, applications, business models and processes. The integration of FinTech has led to the launching of products that challenge traditional finance – PayPal, Apple Pay, Google Wallet, BlockChain Cryptos, etc. They have literally changed the way money is handled, over the Internet or otherwise, and how payments are made. From physical money we are going to digital because of FinTech. As more and more individuals rely on FinTech for the management of their money and less on physical cash, fraud prevention has become essential. The scammers, thieves and thugs of the streets are also turning their interest on how to carry out their business in the world of FinTech. Besides these guys, the underworld and the corrupt politicians of the world are also looking in on how they can utilise these emerging technologies to launder their money. The need for background checks and other AML (Anti-money Laundering) solutions couldn’t be a more urgent requirement in the world of FinTech.

What are the Fraud Prevention Ways?

Although there can be many ways to ensure fraud prevention the simplest ones are usually the best and most cost efficient. Banks and financial institutions have been relying on a process called Know Your Customer (KYC) for quite sometime; it is something that they have to ensure compliance with. Through a simple question answer session where they ask for such simple things as Name, DOB, Address, etc., to sources of income, dependents, assets, etc, they get all the information they need. Then the individual is required to submit documents that prove their identity as well as documents that prove the information they have given is correct. Based on the given information and documents, background checks (to ensure AML compliance) are carried out to make sure the person is not a criminal or not involved in any money laundering activity. Only after clearing all the verifications is the person allowed to open an account or get approved for a loan, etc. This still happens today, but given the Internet and all the improvements in technology the time frame for these has reduced drastically and the process has also been made easier.

FinTech products are mainly digital and online, so one would think how can verifications be done properly and quickly? The answer is third party KYC services that allow FinTechs to gather and verify information at the same time get background results for AML purposes.

How KYC Services Work to Enhance Fraud Prevention?

KYC Services rely on advanced AI, a webcam or a smartphone camera, to carry out all the tasks that were previously mentioned. For example an online payment processor similar to PayPal would partner up with an ID verification provider. Then during the time a user was filling in the registration form, the verification system would take over. It would ask the individual to face his webcam for verification. If there is no webcam it would allow the person to use their smartphone selfie camera. After that it would ask for ID, such as Passport, ID card, Driving License, etc., then it would ask the person to focus in on the picture, DOB, number (if applicable). The advanced AI would then match the picture with the appearance of the individual. Checking for signs of extreme makeup, or any attempt to hide or alter the face. The AI is smart enough to distinguish change due to facial hair, hair styles, glasses, jewellery, etc. At the same time the system checks thousands of Global Watchlists to check if the individual is under suspicion or involved in any money laundering activity. All of this activity is done in real time, is recorded and completed in under a minute. The KYC Services would decline any individual using a fake identity or stolen identity. The same way the background check would support AML, highlight the individual and decline them.

What to look for in a KYC Services Provider?

Having mentioned how KYC can enhance fraud prevention, it is good to know what to look for when searching for a verification service provider. 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. Second comes speed and ease of use. If the process is too complicated and time consuming it could cause legit people to avoid it. Companies that provide such services are good have verification times that are less than a minute. Although almost all service providers use an AI to carry out the verifications, the better ones offer HI (Human Intelligence) along with the AI. Once the verdict is given by the AI it is verified by live people to ensure there are no false positives. Last but not least, the more services a KYC services provider offers usually the more value for money you get. So besides live KYC, some offer offline KYC services and AML services; in this the individual has the option to submit document for verification instead of showing on camera.

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