Customer-Friendly and Cost-Efficient Technology to Prevent eCommerce Fraud

Online fraud rose 15 percent between 2015 and 2016, and approximately $32 billion in costs associated with e-commerce fraud occurred in 2014. LexisNexis reported that 1.5 percent of retailers’ revenue is linked to fraudulent transactions. Continued data breaches also put online shoppers and retailers at risk. However, you can safeguard your eCommerce business from fraud by enhancing your existing security with easy to use, cost efficient technology tools.

How People Are Gaming the System

Before safeguarding your e-commerce operations, it’s important to understand how people are getting around security measures in the increasingly card not present (CNP) transactional environment. Some common ways eCommerce fraud occurs include:

Vulnerability in Mobile Devices and Infrastructures. Data breach occurs when vulnerabilities exist. Even the largest and most sophisticated businesses are vulnerable, as evidenced by headlines regarding Sony, Yahoo and retailers like eBay and Target. They can happen on almost any device, too, and with the rise in the use of mobile devices for both personal as well as business purposes, there has been an exponential growth in the number of well-organized cyber-crimes and independent hacks.

Account Takeover Fraud. Account takeover occurs when a fraudster uses a piece of stolen personal information to attempt to gain access to a private account. This does not have to be a social security number or PIN code – anything from an email address to a username, any identifier used in the validation process can work. As an example, a fraudster could use an email and login for any account and run that against services such as PayPal, eBay, Amazon and virtually any other mobile app – in minutes. Validated credentials can then be sold for hundreds or thousands of dollars on the Dark Web.

Chargebacks and Reversed Transactions. This form of “friendly fraud” happens more often than you think. More than 86 percent of chargebacks are estimated to be fraudulent. It makes it easy for customers to get a refund via their credit card companies by disputing charges while putting the burden on the e-retailer or business owner to prove that the charges are valid.

Identity Theft. While ushering in the EVM chip helps to reduce fraud in person, it doesn’t stop fraudsters from viewing the physical card number, recording it and using it online. Moreover, hackers can get personal data online from doxxing (the internet-based practice of researching and broadcasting private or identifiable information) and can often link public information with bits of personal data, such as the last four digits of the social security number and the birth date and address from a voter’s registration database online.

Tech Solutions That Work

With the increase of card not present (CNP) and mobile transactions, the good news is that you can safeguard your online business with the right tech tools. Here are some quick and easy tech solutions to instantly prevent eCommerce fraud:

ID Verification via ID Authentication. Quick and easy ID capture can allow online retailers to validate an ID in seconds. Forensic tests can be performed in real time to ensure that the ID presented is authentic. Scanning the ID also allows retailers to get necessary information that is accurate to populate into your point-of-sales (POS) system and CRM. This allows for quick verification of customer data such as age and address to verify the sale of an alcohol wine club membership or other age or geographically restricted business. It also removes the inconvenience of manually entering in data, improving shopping cart abandonment rates.

Biometric Security Measures. Facial recognition match makes it easier and more user-friendly to verify identities and integrate with existing apps or systems. Customers can simply snap selfies to verify that they match the photo on their government issued ID from a webcam or mobile device. This extra step prevents fraudulent transactions by further binding a person to their identity.

By recognizing that there are quick and cost-effective tech solutions to manage online retail fraud, you can instantly reduce your risk and recognize good transactions while flagging bad ones. As a bonus, you get the added benefits of:

  • Verifying Age and Address
  • Clean CRM/Customer Database with Accurate Information
  • Fast and Friendly Customer Check-out Experience

See what verification tools are right for your business!

 

IMPROVING IDENTITY VERIFICATION SOLUTIONS IN FINANCIAL SERVICES

Despite advances in technology, such as the spread of credit cards with microchips, in 2016 more than 15 million Americans lost $16 billion as a result of identity theft.

Financial services is an area where identity verification is crucial. Financial institutions must ensure that customers are who they claim to be, but they also do not want to make the verification process very difficult and annoying for customers. Mistakenly giving a malicious actor access to a user’s bank account could result in devastating consequences. But what are customers willing to do and what should they do in order to have security? We know that today, answering a few questions and providing a password is easily hacked by sophisticated fraudsters.

Fortunately, there are a number of solutions to protect customers from fraud that are also user-friendly and fast.

Onboarding and New Account Creation

Bringing new customers on board needs to be quick and easy, but also secure in order to protect both institutions and customers. When a new bank account is opened, it’s the institution’s responsibility to verify the identity of the user. The bank must first verify that the given name and Social Security number match a real person, typically by contacting one of the three major credit bureaus. Next, the bank must verify that applicants are who they claim to be by asking questions about their personal history, such as cities or streets where the applicant has lived in the past.

Financial institutions in the U.S. also need to comply with applicable security regulations when opening new accounts. “Know Your Customer” (KYC) is a policy for businesses who need to verify the identity of their clients in order to prevent crimes such as fraud, identity theft, and money laundering. KYC programs begin by collecting and verifying information about customers and checking them against a list of known criminals. Higher-risk customers have additional information collected, and their activity is monitored for potential red flags.

All of these processes can be streamlined and automated by the intake and authentication of data from a government issued ID, like a driver’s license. Authentication solutions that scan an ID, on a desktop or mobile device, can verify a credential in seconds to validate it. This then allows the institution to match the verified credential to the person. You may do this visually at a bank, or through a mobile facial recognition app that will match the photo on the ID to a selfie taken.

Mobile Banking

Mobile banking is a trend that is set for explosive growth in the years to come. In 2015, KPMG estimated that the number of mobile banking users would double in the next 4 years to 1.8 billion people.

This rapid growth of mobile banking makes the identity verification process even more important. Traditionally, mobile banking customers have logged onto their accounts using a username and password. In the event that they forget this information, customers need to provide data such as their Social Security number or credit card, or answer “out-of-wallet” security questions.

However, in recent years, banks have explored alternate security measures, such as biometric security. For example, many banking apps now make use of fingerprint and facial recognition technologies. In addition, some financial institutions allow users to verify their identity using their voice when they call the company’s phone number.

It is possible today to open an account and conduct all your banking without ever stepping foot in a bank, but you want to make sure that your financial institution is taking proper security measures and all the better if they are fast and easy for customers!

 

Tech Solutions for Access Control and Visitor Management

With news of massive data breaches in the headlines every other week, it’s no surprise that security threats are a growing concern for businesses. A February 2017 study by Javelin Strategy & Research found that 15.4 million Americans were the victims of identity fraud in 2016, a dramatic increase of more than 2 million people from the year before.

From glittering high-rises to government labs, security professionals want to make sure they’re letting the right people into the building. It’s extremely important for a number of industries, including education, defense and airlines, to prevent security breaches and stop the unauthorized access of sensitive information.

Fortunately, there are a number of quick and easy technology based solutions for access control and visitor management. These solutions can be used to verify the identity of individuals entering your business.

ID Authentication & Scanning

ID scanning is used to authenticate an identity document and determine whether the holder should be allowed entry into the premises. There are several types of ID scanners that verify documents in multiple ways: Some scan the ID’s barcode, while others read the ID’s magnetic stripe like a credit card, and more robust software can perform forensic tests to ensure that an ID is not forged.

Solutions such as this can be facilitated via a desktop scanner, but there are also more modern and efficient experiences via mobile apps and self-service kiosks. These are especially helpful for high traffic environments and also offer a solution for employee and personnel access monitoring in high risk buildings.

In the event of a crime or disturbance, an integrated ID scanning solution can track the history of the documents that it reads in order to identify potential suspects. Scanners allow businesses to capture information such as an individual’s name, age, gender, photograph and other identifying information, along with the date and time of access into their applications. Businesses can easily create and manage visitor logs and even use this technology to facilitate easy badge printing with accurate information. In addition, they can maintain a list of VIP or banned users among the business’s clientele to check against when an ID is scanned, alerting employees of preferred or barred status.

Biometric Security Measures

Although ID scanning is an effective way of controlling access, it doesn’t verify that the ID holder and the ID owner are the same person – after all, IDs can be stolen or fake. To do this, you’ll need to use alternate security measures. One example is biometric security, which identifies a person’s unique traits, such as in facial recognition, fingerprints, voice or eye patterns.

Biometric security measures are more secure than ID scanning because they effectively remove the chance of impersonation. They are automated and extremely quick while leaving very little room for error. Another benefit is that biometric security measures can easily be added to existing security systems that are mobile, desktop or even kiosks, in order to provide secure authentication.

No matter your environment, it does not hurt to think about simple but effective ways to be more secure.




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Improving Border Security with Better Technology Solutions: ePassports and Acuant CHIP™

Governments are increasingly turning to advanced technology like ePassports to secure their borders and its about time. Some nations like the Netherlands and Brazil use ePassports throughout their countries, but in many cases, it seems like the technology is far ahead of the adoption. With 328 ports of entry, more than 7,000 miles of borderlands and 95,000 miles of shoreline, the U.S. cannot rely on physical barricades and security checkpoints alone. ePassports that contain biometric information can be used by border security to quickly verify the identities of travelers without sacrificing accuracy.

Biometric passports include microprocessor chips that are embedded into the cover. Currently, facial, fingerprint, and iris recognition are the three types of biometric methods used in e-Passports. The chip contains a digital file of each biometric feature, and a comparison of features is performed at the time of crossing. The International Civil Aviation Organization (ICAO) has detailed the specifications that machine readable travel documents should have to create standardization across countries. Public Key Infrastructure (PKI) is used to authenticate the traveler’s identity through the passport chip. PKI makes it difficult for identity thieves and other criminals to forge ePassports.

Facial recognition is another component of ePassport technology that can aid with border security. Canada is already planning to use facial recognition technology within their major airports by the end of 2017. This new technology aims to allow passengers to use self-service border kiosks to assist with clearance. As biometric identity verification becomes more reliable and commonplace, consumers can use this technology through their mobile devices or at self-service kiosks in airports.

The omnipresence of biometric technology will enable more thorough screenings in less time. Chip readers can also be used in more commercialized settings, like in the hospitality industry. International travelers can use ePassports at self-service kiosks in hotel lobbies to bypass the language barrier and check into their rooms. ePassports can expedite the check-in process for hotel guests while leaving hospitality staff free to provide more personalized service.

Our new partnership with Mount Airey Group, a provider of identity solutions to federal agencies, launches the industry’s most comprehensive authentication product that will strengthen border control by minimizing the use of fraudulent passports. Acuant CHIPTM – our chip reader technology will be a core component integrated with Mount Airey Group’s Ozone® ePassport validation product.

The comprehensive ePassport solution is designed to handle a host of issues unique to passports with individualized policies for every country, and complies with all ISO and ICAO standards. We expect demand for these solutions to grow with the continued proliferation of ePassports and chip technology for border control as well as for commercial use. The convenience of ePassports makes them optimal for airports, where long lines at security checkpoints are common. Mobilizing chip reading technology in border environments will also enhance the coverage, responsiveness, and flexibility of field operations. Biometric technology is poised to become a vital component to national security and by converging physical and digital identities through ePassports, border security can improve accuracy and effectiveness.



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Reducing Identity Fraud in the Growing Sharing Economy

The digital economy has brought about the democratization of goods and services thanks to the advancement of technology, such as increased broadband connections with high-speed. It’s also helped modernize the sharing economy to push it forward so that people can enjoy its benefits of convenience, simplicity and consumer empowerment to share almost anything from bicycles and homes to medical equipment. Even businesses are increasingly allowing their employees to take advantage of the cost savings from using ride-hailing and home rental apps. However, the rising threat of identity fraud is becoming synonymous with the growing digital economy. Discover how identity fraud affects the sharing economy and what action you can take to combat it.

Identity fraud is growing.

Identity fraud steadily increases, and technology is making it easier to do. ID fraud increased by 16 percent between 2015 and 2016, and the sharing economy is not immune. The sharing economy can provide a loophole for businesses that fail to do a thorough background check on providers or hosts of services. Moreover, ID fraud is often facilitated via technology with hacking being as simple as exploiting your enterprise’s vulnerabilities or phishing for information from consumers. These instances can potentially leave your business at risk for cyber attacks and liability suits.

ID fraud presents opportunities for “fraud-fighting” technology.

While reputation ratings have been used to help reduce fraudulent behavior, a more digital resolution is gaining popularity for being user-friendly and more secure. As a solution to circumvent identity fraud in the sharing economy, businesses are taking matters into their own hands with “fraud-fighting technology. Businesses and even governments are using biometric security technology, such as facial recognition systems and devices that detect fingerprints digitally. ID scanning or scan license technology, ID authentication and ID verification services also help to mitigate identity theft. They offer the main benefit of being able to verify people’s identities in real-time.

Final Thoughts

Despite the rising risk of identity fraud within the sharing economy, there are several solutions to address identity fraud. Sharing economy businesses can utilize these user-friendly ID verification solutions to instantly reduce fraud and protect both themselves and consumers. With Acuant, it takes less than 10 seconds to authenticate an ID, and another few seconds to match the photo on the ID to a selfie taken with our facial recognition match. Our solutions are all made to support person and card not present transactions for all operating systems that dominate the digital economy. 10 seconds can amount to saving millions of dollars.





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With Over 3 Million Transactions Monthly, Acuant Debuts New and Improved ID Capture and Facial Recognition Technology that Reduces Fraud While Being Customer Friendly

The new economy provides consumers with more ways of transacting than ever before including in-person and person-not present transactions utilizing web services, mobile devices and apps. With transactions becoming increasingly digital, comes the unfortunate rise and sophistication of identity fraud. We are in the age of the biggest data breaches of all time exposing consumer username and passwords to very skilled hackers and fraudsters at large. Identity verification solutions must be robust; businesses and consumers need to take steps to establish trust and ensure protection.

So what does it mean to protect your business from identity fraud today? And how do the solutions you chose affect your customer conversion/acceptance rates and tackle customer privacy concerns? Addressing these questions and the evolving landscape of the convergence of physical and digital identity is the focus of Acuant’s solutions.

Identifying your Level of Risk and Assurance

There is no one size fits all formula for identity verification solutions. The first step is for businesses to identify the level of risk they are willing to accept. For example, a financial institution will have more security concerns than a bike sharing app and a lower security threshold. Once you know what your level of acceptable risk is, you have determined your level of assurance or level of identity verification required. In the past, a simple password and Knowledge Based Authentication question (KBA) that asks something like “In what city were you born?” has been the standard. This is no longer sufficient for secure transactions. Today multi-factor authentication is recommended.

Multi-factor Authentication means that a user has successfully met 2 of 3 categories by presenting:

  • Something You Have (ID or Credential)
  • Something You Know (password, PIN or Answers to Questions – KBA)
  • Something You Are (Biometrics: Fingerprint, Facial Recognition, Voice)

Multi-factor Authentication

Use Cases and Considering the Customer Experience

While it is obvious that certain industries (healthcare, finance, gaming, etc.) must meet industry regulations, there is an important counterpart to consider:  customer experience. Businesses must identify the balance of security and assurance they need with the friction incurred by their customers. For example, a customer onboarding experience could be as quick and easy as scanning an ID from a mobile device or desktop scanner that will prove that an ID is not a fake. Acuant’s AssureIDTM accomplishes this in seconds using the industry’s fastest, most accurate capture technology. AssureID performs over 50 forensic tests in seconds to ensure an ID is valid. If the person is present, standing in front of an employee, this may be sufficient. Retailers, restaurants and other outlets often do a quick visual scan of ID’s, but that method is not validating an ID and does little to prevent fraud. The addition of ID scanning is a quick and easy way to add level of assurance in any environment with mobile, desktop scanner or self-service kiosk options.

What about transactions where a person is not present? These types of transactions are becoming increasingly common as people find it much more convenient transacting digitally and even use apps for things such as opening a bank account. In this instance, businesses may want a mobile capture of an ID to validate the ID and also require a biometric test such as Acuant’s FRMTM (Facial Recognition Match). Acuant FRM is as easy as taking a selfie and comparing it to extracted biometric data contained in the government issued ID.  Results are given in seconds by matching the face biometrics of a selfie to the face image on the ID and authenticating they match. In addition, Acuant FRM provides liveness detection to prevent fraudsters from using static images. This ensures that not only does the face match, but also there is indeed a live person in front of the camera. This provides two separate authentication factors and offers a higher level of assurance- that a person possesses a valid ID and that they match the photo on the ID. There may, however, be an instance where all you require is facial match for ongoing transactions such as a car sharing service app. In this instance you want to ensure the person driving the car is the one who signed up for the program by engaging Acuant FRM each time they use a vehicle. Both workflows are simple and speedy for customers.

Whether you are capturing an ID, engaging facial recognition match or both- you can be sure that Acuant provides the most user-friendly experience with the highest speed and accuracy. Acuant provides the utmost security for local, mobile and cloud services. No images or data is stored on devices, which means that customers do not have to worry about misuse of personal information with Acuant.

 

The Acuant Advantage

In addition to being a leading identity verification provider for over 20 years, Acuant possesses the largest ID document library in the industry recognizing ID’s from over 200 countries (including but not limited to passports, driver’s licenses, visas and military ID’s) which enables our unparalleled accuracy ratings. Our solutions are made for mobile and desktop environments, compatible with Windows, iOS, Android, Hybrid and HTML 5 and built to allow meeting the highest level security requirements and regulations such as KYC, PII, HIPAA and AML. Download our apps to see Acuant in action and test your selfie skills with Acuant FRM!

iOS App

Android App

HTML5

Biometrics Boom: Juniper Predicts 600M+ Mobile Devices will use Voice and Facial Recognition by 2021

 

Biometrics is one of the hottest security topics in 2017. Businesses are realizing they must supplement basic login credentials with much stronger authentication methods, such as fingerprint and facial recognition technologies. Juniper Research study, Mobile Biometrics: Consumer Markets, Opportunities & Forecasts 2016-2021, finds that biometric authentication is ready to move beyond fingerprints alone and use several different identifiers, including facial recognition and voiceprints.

The research notes that these methods will increase from being installed on an estimated 190 million mobile devices in 2016 to exceed 600 million devices by 2021. As biometric technology becomes more commonplace in the business environment and more accepted by consumers, industries can leverage it to ensure stronger identity security.

This will likely begin to transform security in a host of industries that are especially vulnerable to cyber-attacks. With the increase in popularity of mobile payments and mobile healthcare, the finance and healthcare industries in particular can benefit from using biometric technology to verify identities.

Here’s what to expect in 2017:

Consumers will Quickly Adopt Biometrics

When biometric technologies first rolled out, consumers were apprehensive and sometimes refused to use them.  However, this apprehension towards biometrics is being steadily broken down through consumerization. Technologies that were previously used only for official purposes are now available on the market for consumers to buy.

For example, in the US, the use and collection of fingerprints is often correlated with law enforcement, but Apple now allows users to unlock their devices through their fingerprints, which has helped break down the apprehension of using biometrics for everyday use. The use of selfies in general has allowed people to use photos in a variety of ways, and Facebook and Instagram have capitalized on that by using facial recognition. Biometric technologies that consumers once rejected have become the norm for many consumers, paving the way for much tighter security processes.

 

Companies will Seek to Build Stronger Authentication Continuums

As consumers embrace and adopt new technology, it’s beneficial for that technology to be more interconnected. Businesses are able to leverage this interconnected technology by using it throughout the enterprise or with their products. Utilizing biometric technology with their products, allows consumers to have a higher degree of customization and personalization. Further, an authentication continuum based on biometrics will result in a higher level of overall security, which is key for companies that prioritize robust security.

For example, just doing facial recognition by itself isn’t sufficient most of the time. Tying facial with identity, document authentication, other attributes and biometrics will build a stronger authentication continuum that will lead to a greater level of security.

With biometric technology continuously evolving and the increasing sophistication of hackers and identity thieves, the future of identity verification may more closely resemble science fiction than our current reality.

Top Healthcare Trends for 2017 Include Telemedicine

This year promises to bring a number of significant changes to the healthcare field. As technology advances and a new administration brings change, the healthcare will continue to move in new directions. A few of the most likely 2017 healthcare trends:

  • Telemedicine explodes

MedCity News reports that last year saw telemedicine accelerate, with more people getting their care through virtual visits. This year, technologies such as cloud-based tools will make it easier than ever to offer excellent health services from afar.

  • New telehealth regulations

As telemedicine moves into the mainstream, practitioners will have to assure that they are in compliance with a growing number of regulations.

Experts say that compliance initiatives and audits will be highly active areas. It is more important than ever for healthcare practitioners to ensure that they are properly safeguarding their patients’ personal data.

  • The end of ObamaCare?

At this writing, Congress is making the moves that will make the sweeping healthcare law a thing of the past. The plans for healthcare laws to replace it are still in the works. Those in the healthcare field will need to keep up with events to know what to expect and what will be expected of them.

 

  • Changes in how we verify insurance

New technology means that it is easier than ever to verify a patient’s insurance and verify what services and medications are covered. Better accuracy means fewer uncovered procedures and fewer unpaid invoices from clients.

  • A better outlook for claim denials

The improvements in verification mean that those in the healthcare field will be taking fewer chances on procedures that are not covered by a patient’s insurance. This leads to higher patient satisfaction with less out of pocket expenses.

In 2017, the Meaningful Use incentive program is replaced by the Advancing Care Information program for those paid by Medicare. The system will give patients more latitude in the technology they use day to day to provide excellent care and to preserve patients’ privacy.

Changes in healthcare laws and preparing for additional regulations relating to patient privacy is a given. But practices and providers can ensure they are prepared for the evolving landscape by utilizing technology based solutions that both add value and meet regulation; all while improving the patient experience.




Self-Service Kiosks for Healthcare




Identity Fraud Prevention in Today’s Digital Economy

With cyber criminals becoming increasingly sophisticated and hackers making headlines regularly, it is imperative that businesses employ advanced security technology. Identity proofing is a term for identity verification that is being adopted by analysts such as Gartner. From Gartner’s study1:

Identity proofing, a process that demonstrates with sufficient confidence that the user is who he claims he is, helps to establish and maintain trust in the identity throughout the relationship.

Identity Proofing Process

Collecting and verifying information about a person, provides businesses with another layer of assurance. Financial institutions can use identity proofing to prevent financial fraud and money laundering, while ecommerce companies can rely on it to combat card-not-present fraud. And with today’s technology, businesses can ensure that their processes are user-friendly, adopting technology that users are familiar with (i.e. fingerprints and selfies for facial recognition).

According to research by Aite Group, card-not-present (CNP) fraud in the U.S. is expected to reach $7.2 billion per year by 2020. Government agencies need sophisticated identity proofing for security clearances. Identity proofing also helps organizations in the healthcare industry prevent HIPAA violations. As identity fraud becomes a concern across industries, identity proofing solutions are needed to establish trust in digital relationships.

Organizations that need to proof identities are turning to third-parties to build solutions. According to the Gartner study1, third-party solutions have come up with various options for companies to use to verify identities, including:

  1. Knowledge-based verification: In this approach, the user is asked a series of questions that they would need to know the answer to in order to confirm their identity. Examples of these questions include past mailing addresses, mortgage amounts, and lender names. Knowledge-based questions aren’t entirely secure, though, since the answers to these questions can be obtained through a hack. Back in 2015, scammers were able to steal tax refunds by figuring out the answers to these questions.

 

  1. Secondary passwords: ID proofing services can issue temporary one-time-use passwords to verify identities. Users are sent a one-time password via an “address,” like a home address or email address. They then have to enter the one-time password to verify their identities. Organizations may ask users to bind themselves to an identity associated with a known trusted online account, like their social media accounts. The risk with these other accounts is that social media profiles and email addresses can be hacked.

 

  1. Biometrics: In countries with fingerprint registries, organizations can require fingerprint scans to verify identities. However, some users may take issue with this method if they are concerned about privacy. Organizations can also use voice recognition and facial recognition to verify identities, although facial characteristics change throughout life. As biometric technology becomes more commonplace in the business environment and more accepted by consumers, industries can leverage it to ensure stronger identity security.

Proofing identities in other countries can be challenging since different countries use varying forms of government-issued IDs. According to the Gartner report1, some of the problems global companies can run into are:

  1. Social Security Numbers Create Vulnerabilities: In the U.S., citizens are often identified by their Social Security Numbers, but this method of identification doesn’t translate over into countries. Some countries also do not have official national IDs. Instead, these countries will issue out IDs for specific purposes like access to healthcare or tax collection, which may not be considered sufficient for identity proofing.

 

  1. Different Global Standards: Privacy and data protection legislation vary between countries, which limits the information identity proofing services can capture, gather, and store. This legislation can even block companies from sharing data across borders.

 

  1. Technology Verifications Often Falls Short: Technology limitations and regulations can prevent identity proofing providers from being able to conveniently verify information against government lists like registries of births, marriages, and legal permits.

Although fraud is an increasing concern for global companies, the good news is that options for solutions are also increasing with a wide range of identity proofing services that can be adjusted to fit different industries.

 

1Source Gartner Identity Proofing Is the Cornerstone of Trust in a Digital Relationship, October 2016

Avoiding ID Fraud, Car Theft and Auto Rental Chargebacks

The advent of the Internet of Things has turned 20th-century cars into automated smart cars that harness sensors and the Internet for connectivity and convenience. In fact, connected cars can contain as much as 100 million lines of coded information. With such large amounts of data, the chances for a possible hack and access to personal data increase; moreover, the growth in car sharing services as a car rental option or a growing division of an existing company also presents cybersecurity issues. However, these problems are resolvable by taking the right steps to avoid ID fraud, car theft and auto rental chargebacks. Here are a few actions to consider.

1. Consider ID scanning & verification

Car rental and car sharing services are susceptible to fake IDs and auto theft, especially during a test drive or when loyalty programs can make it easy for multiple online reservations without the need to swipe a card. However, ID scanning can help reduce this issue. Solutions via mobile devices or scanners allow for quick data capture, ID authentication and even identity verification in real time.

2. Use biometric technology

According to the FBI, more than 700,000 cars are stolen on an annual basis in the United States, with one stolen every 45 seconds, as of 2015. Weak links in code and anti-theft systems explain why car thieves can easily steal vehicles and access personal data from consumers and even suppliers and manufacturers. However, biometric technology, such as facial recognition, offer viable solutions for mitigating this issue. For instance, facial recognition can be used in real-time to authenticate the driver and send a text message to the owner of the vehicle, should an unauthorized person enter the car.

3. Spot potential chargeback signs

While the sharing economy offers car sharing as a new revenue stream, dishonest customers can present security issues in the form of chargebacks. Chargeback fraud is often associated with increased customer complaints, and a history of chargebacks can increase this fraud. That’s why it is vital to recognize risks. Additionally, car sharing services can engage facial recognition to ensure that only drivers signed up for the program are using the authorized account and consider engaging further ID verification services while assessing vulnerabilities.

Final Thoughts

Technology is very often the driver of better services and better products for cars. However, connected cars can leave their drivers and passengers vulnerable to ID fraud and car theft if not secured properly. Business owners and managers of car sharing services or traditional car rental services can also leave their businesses exposed to chargeback fraud from their own customers. You can prevent these actions by using the right technology or consulting with an expert on ID verifications and security services.