The Curious Case of Fraud ft. Pop Culture Legends, Zombies and Invisible Threats
Jian Yang from Silicon Valley, Jack Donaghy from 30 Rock, Lisa Bouvier from The Simpsons, and Elle Woods from Legally Blonde are some of the famous characters in the recent pop culture universe.
But they are also the names of children (read: nonexistent) who drew out close to $320,000 from the US government.
In a curious case of synthetic identity fraud, a fraudster faked Social Security Numbers for ten nonexistent children, then awarded monthly benefits to them based on deceased individuals' identities, listing these children as dependents. I call them zombies in disguise, hungering for monetary claims.
Baleful - Yes!
Another ingenious fraud - Yes!
Could have been stopped - Yes!
Synthetic identities pose a grave threat, amounting to 10-12% of all losses to banks, lenders, and credit card companies in India and the US.
Synthetic identities are forged by either completely fabricating the persona and identity documents or mixing a bunch of stolen identity information, for example, Elle Wood's name with Jack Donaghy's email ID and Lisa Bourvier's photo.
How to Win a War Against Someone Who Doesn't Even Exist
Synthetic IDs just have to be 'real' enough to become an eight-lane highway on the itinerary of fraud. If the fabrication is smart enough (most neo-fraudsters are smart), they can bypass routine checks easily, extract funds, and disappear back to their zombie land or whichever pop culture universe they have come from.
This makes it hard for an organization to halt synthetic ID fraud. How do you win a war against someone that doesn't even exist?
The answer lies in robust identity verification, device fingerprinting, behavioral signatures, and additional data signals that strengthen your fortifications against synthetic IDs.
Robust Identity Verification
We must look beyond traditional methods of ID verification by capturing the document automatically, verifying it against official sources and then matching this information against user-provided inputs. This would reduce the chances of letting zombies and pop culture legends beneath human eyes (remember the chapter Human Error from Kathryn Bigelow's Zero Dark Thirty and what it cost).
Device Fingerprinting
Fraudsters use the same devices and similar tactics to target the same companies to siphon off funds repeatedly. The unique Device Fingerprint, analogous to the unique persona (name, email, identity documents, etc.), provides a foolproof way of identifying a device uniquely by leveraging multiple software and hardware parameters. Thus helping you mitigate risks and prevent fraud.
Behavioral Signatures
Analyzing user behavior gives you power over fraudsters in an unprecedented fashion. Fraudsters are likely to be more familiar with the KYC process, copy-paste identity numbers, and hesitant to enter personally identifiable information. Behavior AI creates a unique behavioral signature derived from mouse movement patterns, typing patterns, navigational patterns, screen pressure, mobile movements, haste detection, or device orientation.
Alternative Data Signals
Digital footprints associated with a user's email, phone number and social presence can help you create comprehensive risk-profiled identities and detect fraud patterns. A non-existing digital footprint can point to fraud. How likely is Alec Baldwin's character running rounds on Instagram, Twitter, Amazon, and other popular digital platforms?
While our zombies and legends of pop culture can bypass one of these fortifications, it is improbable that they go undetected at all these checkpoints. Additionally, this stack runs in the background without compromising user experience. So, you win a war against someone who doesn't exist by being existent, but invisibly.
~ Parth, excerpts from the last Bureau, Inc. (We're Hiring)'s newsletter.