Identity Theft – One Fraud Multiple Facets

Identity Theft – One Fraud Multiple Facets

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Identity theft is a global crime. All types of identities, including the financial, medical and business identities of common people and business executives are stolen and exploited to defraud businesses and institutions. 

As per the Federal Trade Commission’s (FTC) 2019 report, 1.4 million identity theft fraud reports were processed. A total of $1.48 billion were lost in those frauds. The most common frauds that surfaced were imposter scams, credit card fraud and debt collection through stolen identity scams.  

Symantec’s internet security threat report stated that account takeover fraud rose by 79% and new account fraud rose by 13% in 2018 as compared to 2017. 

These fraud reports are raising unease among the business circles and they are very keen to find an ultimate solution to eliminate these frauds. One of the most common counter fraud techniques employed by businesses globally is real-time identity verification of the stakeholders of an entity. It provides a risk cover while enhancing the compliance and customer onboarding procedures of the company. 

A 2018 survey of identity-theft-related crimes in the UK based banks revealed that banks are using enhanced due diligence tools (online identity verification, and AML compliance tools) to mitigate the risk of identity fraud with them.

Industries targeted by identity thieves 

Contrary to the common notion, all types of businesses are targeted by identity thieves. Whether it is a financial institution or a non-profit organization, all industries are the targets of identity-theft-related fraud. 

Every business has a unique business model, but fraudsters do find a way to invade the protocols using a stolen identity. The following discussion will provide an insight into how a stolen or fake identity can take different facets to defraud several businesses. 

Financial industry

Key motive behind fraud is monetary gain. So, fraudsters commonly target financial institutions. And most common frauds conducted with a stolen identity are credit card fraud, account takeover fraud, money laundering, mortgage fraud, and wire transfer fraud, etc. 

Insurance institutions, mortgage houses, banks, stock exchanges, investment companies, etc. are the common victims of these frauds. 

A 2018 survey of Insurance Information Institute(III) of the USA revealed in its 2018 survey that 3 million identities were stolen in the USA alone and more than 50% of those identities were used to defraud businesses. 


Fintech is growing at a rapid pace. Fintech startups raised more than $16.4 billion in VC/PE investments. The growth potential of fintech is huge, so is the risk involved in this industry. Technological solutions used to transform the traditional financial processes have left some loopholes for cybercriminals. 

Common frauds in fintech using stolen identities are money laundering, payment frauds, illegal funds transfer, etc. 

Online payment solutions, cryptocurrency exchanges, online mortgage, and rental service providers, etc are common victims of these frauds. 

One instance of fraud in fintech using the fake identity is when inmates in Florida county jail laundered $8000 through bitcoin. The inmates bought fake identities and credit card credentials through the dark web and used them to buy bitcoins. Once the bitcoin was purchased they converted it into fiat and transferred it into mysterious accounts outside the jail. The jail authorities found about this crime when they investigated a certain pattern of fund transfer, from the accounts of inmates. 

If the cryptocurrency exchange would have conducted identity verification before selling the bitcoin, the fraud could have been traced at the very first stage, because the criminals were using stolen identities and credit card credentials to make transactions. 


The healthcare industry is considered a pure industry, free of any fraud. Contrary to the common belief, cybercriminals are posing a threat towards the healthcare sector as well. They target patients, hospitals and other healthcare institutions, equally.

Common fraud in the healthcare sector are getting free medical services and buying prescription drugs using a patient’s identity. These frauds affect the credibility of the healthcare institutions and their doctors. 

1.3 million child identities are stolen every year and these identities are often used to defraud the hospitals. For example, a teenager in the USA was not allowed to donate blood on the basis that she was treated for HIV in the past. When investigated it was found that the identity of that girl was used to defraud a hospital in some other state to get an HIV treatment. The hospital did not verify it’s patient’s identity and gave a clean chit to a person with HIV. 

In another instance, the woman’s identity was used to get free treatment and her medical credentials were manipulated. When the real patient went for heart surgery, doctors cross-checked her medical credentials and found that the data was manipulated. In case the medical credentials would not have been checked the woman might have lost her life. Because the major credentials of her height and age were changed, that is used by doctors to decide medication dose for a patient. 

Such frauds are often conducted with the intention to get free services or prescription drugs but it can affect the credibility of a hospital.  

Education sector

Education is no more limited to brick and mortar schools and universities. Educational institutions are onboarding students online and are providing online courses. Other than the institutions, many online platforms are offering free as well as paid courses and material to the students. 

Commonly the stolen identities are used to imitate a credible students to get free education services. Also, online educational institutions are defrauded to get access to free study material for selling it to other websites.

In case a website is exploited to get a copy of content protected with copyrights, that website will be deemed responsible for the loss of the original owner of the content (books, research papers, etc). Because only a few credible sites are allowed to give access to the books and notes that have copyrights. 

The website loses its credibility if the identity of a student enrolled in an online course is used by an identity thief to attend online courses. Educational institutions and online educational platforms also need to perform due diligence on their participants to mitigate the risk of serving an identity thief. 

Travel/hospitality industry

The travel and hospitality industry caters to a wide range of clientele, so their risk is high. The common frauds that occur in the travel and hospitality industry are, imitating a guest to get free services or travel free of cost. Also, the criminals at large use stolen identities to use the hotel as their hideout. 

The travel industry is exploited by criminals for human trafficking, drug and money laundering. For instance, human traffickers use fake identities to fool the airport authorities to deliver underage children to other states for child labor. 

The above-discussed industries are just a few examples of the risk that stolen identities pose towards several industries. Other common victims that have been highlighted in the news are the e-commerce industry, real estate industry, government institutions, etc. 

How Identity verification is the savior of multiple industries?

Frauds related to identity theft are the risk for several industries. One stolen identity can be used in multiple ways to defraud businesses. Real-time identity verification can identify an individual within a minute.

Identity verification is a feasible and cost-effective solution to mitigate the risk that identity thieves pose towards a business. 

Real-time identity verification not only provide businesses with a risk cover but also helps them in seamless KYC and AML compliance and improves their customer trust. Customers feel more comfortable and secure with companies that run due diligence on their clients without any long delays. Also, it increases the credibility of an organization and prevents any penalties due to non-compliance.

Why Millennials don’t care about Conventional Banking Services?

Why Millennials don’t care about Conventional Banking Services?

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Millennials are different from the baby boomer generation. They earn less than what the previous generation was earning at their age. It is odd that the banks have been unable to capture the market of millennials – the perfect target audience right now. However, faster customer identity verification can make banks millennial-friendly. 

Overview of Millenials

Millennials are the first of their kind – the true digital natives! 

They are internet savvy and armed with smartphones, which they check dozens of times a day. We are talking about people currently in the age group of 18-34. Smartphones play a huge role in their lives. 

The banks have started to think in terms of apps and online services. Also, the young generation is prone to fast internet.

What does internet speed have to do with customer identity verification?

A lot!

Banks are not selling toys or stationery. They have to comply with the financial regulations in providing their services. Say, a millennial wants to open a bank account. The ideal or expected way would be to open it over the internet. But not many banks are providing these services currently.

Why Banks have a hard time Capturing Millenials 

The millennials are not happy with the conventional banking system. They do not have to depend on any particular bank or service in most cases. An army of Fintech companies and products are swarming the markets. 

But despite the banks’ marketing, they are not there where they would like to be, in fact, they are far from it. If there is a bug in the app of a bank, the young customer would not like to wait for it to get fixed. They would like to know, which service is better and faster. 

Moreover, the banks have not yet figured out the perfect products that cater to this market. Millennials are putting off buying large ticket items but, in the future, they will be holding a significant amount of wealth.

Cybercrime is the elephant in the Room 

Let’s address the elephant in the room; privacy and security. We are spending more time gawking at the screens of computers and phones than ever before. You can buy stuff online, apply for a visa, date someone, and the list goes on. However, among this significant amount of data, security is of utmost importance,

Privacy breaches, hacks and other forms of cyber attacks have made this generation weary and cautious of banks. Since the majority of wealth exists digitally, this raises concerns for privacy.

A Safe and Bright Future

One obvious tool to handle security concerns is the verification of identity. When a customer is about to send or receive payment, the verification should be foolproof. This relates to the identity of the user. 

Each time we interact online, it leaves a footprint, which creates their digital identity. As technology gets more advanced, so do the tools. Banking and security services that are powered by AI and machine learning can collect the data better, faster and with better accuracy. Faster identity verification solutions are a healthy sign for banks. 


There are troves of rich data available for businesses. How fast banks capture and utilize it to offer banking products to customers will define who can corner this market first. Banks need to get aggressive in integrating state of the art technology in their services. Otherwise, more technology-based services will take over.

10 Quick Tips Regarding Identity Theft Protection

10 Quick Tips Regarding Identity Theft Protection

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Identity fraud has grown substantially in the past two decades, and unfortunately, it is here to stay. Here we share 10 quick tips about identity protection so that you’d have the necessary knowledge when choosing among the best identity theft protection services. 

The number of people hit by identity theft each year is staggering. In the US alone, this number reached over 16 million in 2017. The stats from the rest of the world are similar. Hence, the rising demand for identity theft services.  

These services monitor personal information on websites, public records, and other credit applications to look for suspicious activity. Click here for a basic intro by the consumer financial protection bureau. The major service providers, besides providing protection against identity theft, offer insurance for the following;

  • Specific out-of-pocket losses
  • Chat room monitoring
  • Public record searches
  • Monitoring black market websites
  • Anti-virus software

10 quick tips about identity verification services

  1. Identity theft protection services basically offer monitory and recovery services. Monitoring keeps an eye out for thieves looking to steal your identity, while recovery service helps to deal with the aftermath.
  2. There are two main types of monitoring services; credit monitoring and identity monitoring
  3. Depending upon your choice, credit monitoring can track your credit reports at different credit bureaus
  4. Credit monitoring services might alert you when;
    • a firm examines your credit account
    • a new credit card account is opened under your name
    • a creditor or debt collector says your payment is late
    • You file for bankruptcy
    • There is a legal judgment against you
    • Credit limit changes
    • There are changes in personal information (name, address, phone number etc.)
  5. Your monitoring service will only alert you when something suspicious shows up on your credit report. If an identity thief steals your social security number or files a tax return in your name, your theft protection service will not inform you.
  6. Identity monitoring services inform you when there are unusual requests regarding your identity. For instance, a request for a change in address.
  7. Identity recovery services help you after the theft. Normally, the trained counselors and case managers help you in recovering your name and finances.
  8. Major identity theft services offer insurance as well. Normally, they only cover out of pocket expenses, for example, in reclaiming your identity.
  9. Putting a security freeze on your credit report will prevent the thief from opening any more accounts in your name. You can unfreeze it free of cost by credit reporting companies – Experian, TransUnion, and Equifax (in the U.S.).
  10. If you suspect that someone has stolen your identity, you can put a fraud alert on your credit report. This will not freeze your account but the new lender will take extra measures to verify your identity. 

Credit monitoring products from credit bureaus generally do not provide robust coverage. They might also reduce your rights to sue them. You should seek identity verification services that give you the best cover. The most comprehensive theft protection service is Shufti Pro. It provides the protection using state of the art artificial intelligence and machine learning algorithms, for a fast and accurate theft protection system.

Identity checks – A Profitable Business Strategy or Another Business Expense?

Identity checks – A Profitable Business Strategy or Another Business Expense?

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Online commerce is a necessity of every business these days. With nearly every consumer carrying a smartphone the boundaries of consumer behaviour are getting blurred and identity checks are becoming more and more complicated. Businesses are now generating more sales online than in stores. With an expected increase in online sales reaching up to 4.8 trillion dollars by 2021, the market for e-commerce shows no signs of showing a decline.

The Increase of Internet Fraud in Online Buying

The gaining foothold of online business can be a good thing for accessibility, however, the concerns for security and privacy still remain a gaping loophole. With an increase in web activity comes the threat of online fraud and scams. With cybercrime responsible for depriving the world of nearly one per cent of its GDP, anti fraud solutions and fraud prevention services have become essential for an online business’s security.

The escalation in incidents of identity theft, credit card fraud and other similar kinds of internet fraud has therefore led to the necessity of identity verification measures by both businesses and governmental agencies. However, the process of such verification can be a long and tedious – at least through a manual procedure.

Businesses lose millions of dollars to cybercrimes. From plain old fashioned identity theft to credit card fraud and card skimming techniques, cybercriminals are getting smarter and bolder. This threat to the integrity of online retail has brought on the need to bring about fraud detection and prevention measures.

Identity Verification in the Digital Age

The need to verify the identity of online users digitally has always been a prudent one. This need was tangibly addressed for the first time when iPhone 5S was launched in 2013 with a biometric fingerprint scanner embedded in its home button. Since then smartphones have morphed into integrating multiple levels of ID verification checks, including facial ID verification and retinal scans.

Read: How Identity Verification Solutions Can Make Summer Travel a Breeze and Generate Revenue?

For businesses, this advancement has translated into the establishment of identity verification services that now provide an identity background check for customers within seconds. Shufti Pro is such an online identity verification service provider that provides id verification software as a service (SaaS). It provides multiple layers of verification checks including document verification (IDs, passports, driving licenses etc.), face verification, background checks and AML compliance. All such checks are performed in under a minute, providing the end users with no inconvenience whatsoever.

The Necessity of Identity Checks for Businesses

Now identity checks can be a tedious procedure for businesses to adopt, at least if they opt to do it manually. However, the advent of high-end technology is simplifying procedures that once seemed long, tedious and complicated. Verifying checks are now made simpler through the integration of artificial intelligence and machine learning into such processes.

Many governments have also made the online verification of their citizens a necessary part of their operations and for businesses as well, including the government of UK. This points towards the prudence for businesses to utilise electronic identity verification procedures.

Moreover, if there is a way for businesses to verify their customers in a smooth manner and without going through the slow procedures of physical verification; validating a customer’s identity may be the best thing for businesses. It can end up reducing their losses due to online fraud.

Is Privacy a Concern in Identity Checks?

For those consumers concerned about the whole process of ID verification, to put it simply it is the answer to a simple question for businesses i.e. “are my customers who they say they are?”. Many of us are already familiar somewhat with the procedure of verifying identity. We present our passports at airports for identification, our proof of id when opening a bank account or acquiring a loan. However, in such cases authentication of your identity can take a while.    

In this comes the role of digital verification. The process of online identity verification is simple. With nearly every consumer carrying smartphones with impeccable cameras, users only have to scan a particular identification document with their camera’s that is then authenticated against the set standard of their government and check for any flaws or imitations. Face verifications are performed by scanning a person’s face in real-time through 3D depth analysis and liveness detection of the face.

Such verifying checks are never performed without a user’s consent. Moreover, such services are primarily built to protect users’ data and cannot share it with any third party. They do not have access to any government data and are legally liable to conform to the data protection laws put forth by every government.

All this concludes to the fact that identity checks have become a necessity for businesses whether online and physical (or both). In this regard, Shufti Pro is providing top of the line services through an AI-based authentication system.

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