There are a few things that make AuthenticID different. If you want to get to know who we are, how we fight fraud, and why we fight fraud– this is your guide to our company.
The Types of Fraud AuthenticID Stops
We broadly define fraud as someone presenting themselves as someone or something they’re not. For instance, someone might present an ID. This ID could be real- and not belonging to the person who presents it- or fake, meaning a fake or synthetic identity. Our job is to figure this key aspect out- is this person committing identity fraud? It’s a simple concept, but a highly sophisticated one in action. To combat identity fraud, we’re looking at the way this person is presenting the ID, as well as the ID they’re using to represent themselves. We’ll also look at credentials. Quickly, you can see how complex this could get, including the number of variables just a single ID could contain that must be evaluated.
Who Drives Identity Fraud, and Where Does It Happen?
In the AuthenticID world, fraud can be driven by bad actors as individuals, but also can be driven by organized crime. This means we’re engaged in a high-stakes chess match with these organizations via our services.
The bad actors of organized crime know that identity fraud can be very profitable. These organizations have created both simple and complex ways to steal identities. Their members can falsify identities to open or take over various types of bank or financial accounts. AuthenticID technology can fight this fraud. We’ve created very sophisticated AI machine learning technology that detects attempts at falsifying identity and intercepts that activity before it can complete an account takeover or open a new account.
The financial industry is a huge target for identity fraud, but many other sectors are also targets– and industries that AuthenticID can help. One industry is telecommunications, especially the wireless sector. Everyone now has a mobile phone, but these devices have now become very expensive. Because of their cost, these pricy phones are purchased with payment plans. But here’s an opening for a bad actor: people are walking out the door with costly phones. And if this person has set up a new account or purchased a phone via fraud, they can then take that phone and cancel the account, or just walk away from the account and resell the phone.
Transportation is another sector that sees high-stakes fraud. For instance, rental cars. A bad actor could rent a car, and get the car off a lot via a fake drivers license. Then, that car can be resold to organized crime syndicates.
Credit offers a number of fraud opportunities. By opening a credit card or another type of credit in a fraudulent way, then that’s basically free money for fraudsters. Credit card fraud has a tremendous impact on retail.
The government and public sectors experience identity fraud too. Bad actors can fraudulently apply for and/or receive benefits from the government: unemployment benefits, veteran benefits, tax refunds, and more.
Fraud is Exploding- and We Know Why
A number of different industries are impacted by fraud every day- and often every hour- and occurrences continue to grow exponentially. At AuthenticID, we also look hard at the “why” of this growth to stay ahead of the latest trends in fraud.
One trend that most people have seen both in their personal and their professional lives, from consumers to businesses, is digital transformation. For businesses, even traditional brick-and-mortar stores are transitioning more of their activity to their digital channels and eCommerce. This shift covers businesses of all sizes, including large retail operations like Walmart. In Walmart’s case, a traditionally strong brick-and-mortar operation has now been augmented by a large digital channel to sell goods.
Another aspect of the digital transformation trend that began in the Covid pandemic is faceless transactions. Businesses are interacting with their customers remotely on a more regular basis. You may never “see” who that person is, meaning there’s an opening for fraudsters. We must rely on technology to determine a person’s legitimate identity on digital channels.
One place we see this change most dramatically is, once again, with cell phones. Where previously a customer would go to a store and purchase a phone, now, more customers are ordering the phone at home to pick up in-store. Again, there’s now a new opportunity for fraudsters that occurred rapidly.
Digital transformation has benefited fraudsters in other ways. As businesses are all becoming digital, more sophisticated fraudsters can use their own algorithmic tools in a repetitive way. This could include attacking accounts with algorithms rather than having to physically go to a store location. This means the number of fraud attempts can go up exponentially. Rather than a single trip to a storefront, I can attack a digital account 100 times very quickly. Even if I’m successful once, it’s a more economical means to commit fraud.
Machine Learning and AI Are the Keys to Staying Ahead of Fraud
Staying one step ahead of these well-funded criminal entities and organized networks is tough for many businesses, especially as digital transformation has changed the game so quickly.
AuthenticID relies on very sophisticated machine learning models and tools that ensure we can handle a large volume of transactions. We have a dynamic decisioning team that can look at fraud trends in real time to help us counter fraud attacks with additional defenses and mechanisms. We know that if we shut the front door to fraudsters, they’ll figure out how to get through the backdoor. So that means our business must be dynamic and agile to adjust to these new attack methods.
We know that fraudsters are trying a variety of different ways to make a fake ID, including synthetic fraud. And we also know that they’re using different methods to present that ID. Again, it’s a game of chess, with moves and counter moves. Machine learning ensures that as we figure out a new methodology, it can be applied on a global basis.
AuthenticID is unique in an important regard: we are a 100% automated machine learning operation. Our process does not have humans in the loop, which is not the norm of other providers in the industry. When you add humans to the fraud detection and prevention process, a couple of things happen. One, the process takes a lot longer. It can take minutes, if not hours, sometimes to get something processed in a manual review queue. This process also isn’t as accurate because people are not nearly as accurate as AI is at detecting fraud. Humans are about as accurate as a coin flip compared to what a machine learning model can do. That’s a significant deficit of accuracy.
Applying advanced, automated machine learning means our system is fast. We’re processing all of our transactions in just seconds. Speed makes a difference for several reasons. For a lot of these applications, consumers today don’t always have a lot of patience. They want to get things done fast. If the onboarding process or a verification process takes too long, they often will abandon that process. So we find that it’s very important from a user experience perspective. It also helps our customers with their sales conversion to make their workflow happen with the least amount of friction and as fast as possible.
Corporate Social Responsibility Is More than Just a Buzzphrase
Another aspect that sets AuthenticID apart is how we embody our mission. The All 4 Humanity Alliance is our corporate social responsibility initiative. It’s important for us to have an initiative that would help bind our team together to do something purposeful. But how did we get to the A4H initiative? As we learned more about what the fraudsters and the organized crime organizations were up to, we learned that they were also drivers of human trafficking. Even worse, human trafficking has become the most profitable, fastest-growing category of organized crime. These organizations are effectively getting money from businesses like the ones we’ve mentioned above and are using some of that money to invest in human trafficking.
We also started thinking about what happens to somebody that’s being human trafficked. These victims are losing their identity. Obviously, we’re an identity company. Our focus is on how we protect identity, how we help determine that somebody’s identity is authentic, and how we protect both that identity information and someone’s rights to it. We were struck when we saw this counterpoint that the same organized crime actors are creating this horrific human trafficking problem and stripping victims of their identity and sense of self and purpose. We knew that that was a powerful idea to come together. And so we’re dedicated to innovation and driving momentum to fight this crisis.
The Future of Identity
One thing that is consistently on our minds at AuthenticID is the future for identity. Identity is a foundational part of society today. In nearly every aspect of our lives– whether it’s a social side, or a dating site, or getting a bank account, or going to the the DMV, or renting a car– there’s some aspect of identity at play. We see ourselves as an underlying driver of these identity processes, like a utility for commerce in many cases. As the world becomes more digital, this is particularly important: keeping these identities safe and secure in the digital realm. We continue to be excited for our mission and the value we can add to the world.
If you’re interested in learning more about AuthenticID and the future of identity, please contact us.