Ideal for financial services during customer onboarding, IdentityDetect is the only identify verification method that not only analyzes the accuracy of responses but also the manner in which a person answers a series of dynamic knowledge-based authentication questions.
LEHI, Utah – Jan. 23, 2020 – Fraud costs financial institutions billions of dollars annually. According to an American Bankers Association (ABA) Deposit Account Fraud Survey Report, the banking industry suffered $2.2 billion in fraud losses in 2016, up 16% from 2014. However, a white paper based on a compilation of insights from Federal Reserve and industry subject matter experts says synthetic identity payments fraud cost U.S. lenders $6 billion in 2016.
Synthetic identity fraud, the fastest-growing type of financial crime in the U.S., is a combination of fabricated credentials where the implied identity is not associated with a real person. Stealing other’s identity on the dark web is inexpensive. For example, a person’s credit or debit card information costs $5-110, social security numbers are as low as $1, a driver’s license is approximately $20, and logins for online payment services are $20-200.
Notre Dame Federal Credit Union in Indiana was recently defrauded out of $200,000 when a group of borrowers abruptly stopped making payments. They conducted background checks and authenticated each applicant’s credit score and background — or so they thought. But after further investigation, they realized the loan applicants didn’t exist. CNBC reported Boston-based Aite Group estimates synthetic identity fraud by an individual borrower cost U.S. lenders between $10,000-15,000 per incident.
Despite all the solutions currently in place for verifying the validity of government-issued IDs and other documents, including automated background checks that look at the history of a person’s IDs, one technology company says more can be done.
“Experts say the only solution for greatly reducing fraud is for every customer applying for credit to submit to even more rigorous ID checks than they do already,” said Converus President and CEO Todd Mickelsen. “We’ve developed a unique technology that offers another layer of identity verification to determine that the person presenting an ID is actually the person he or she claims to be. It can catch false identities that have been erroneously validated yet perpetuated in the existing security check system.”
Converus recently introduced a one-minute, KBA-based (knowledge-based authentication) identity verification test specifically designed for financial institutions called IdentityDetect, a credibility assessment tool that analyzes variations in the motor nervous system responses of examinees.
Mickelsen says IdentityDetect uses machine learning/AI (artificial intelligence) to analyze how the user responds to 12 multiple-choice dynamic KBA questions. It goes beyond just looking at error rates (which is what standard KBA does) and looks at how the user behaves while responding.
Current standard KBA protocols available in the market have a 66% overall accuracy — 91% accurate in identifying the innocent but only 41% accurate in identifying the guilty. And the false positive rate is more than 34%. By supplementing an existing KBA system with IdentityDetect, accuracy increases to 83% overall, with an 80% accuracy in identifying the innocent, 87% accuracy in identifying the guilty, and a false positive rate of just 16%.
“This new, short-form KBA identity verification protocol will not only greatly streamline the onboarding of new customers for financial institutions, but also save them thousands if not tens of thousands of dollars by substantially reducing false positives,” said Mickelsen.
In addition to customer onboarding, IdentityDetect can also be used for transaction verification, as well as for ensuring a person updating an online account is actually the authorized user of that account.
Mickelsen says IdentityDetect integrates seamlessly within existing identity verification systems to detect if a person is lying about who he or she purports to be based on how a person responds to knowledge questions.
“It monitors if you answer correctly, how long you take, how you type (known as keyboard dynamics) and how you navigate,” added Mickelsen. “This protocol makes IdentityDetect unique among identity verification technologies.”
IdentityDetect was originally released in 2018 as a 3-minute, long-form test designed for immigration and loan applications. It was designed for financial institutions and governments worldwide. The new short-form IdentityDetect KBA solution is currently only available in the U.S. and requires integration with a KBA data provider.
For more information about IdentityDetect and Converus, visit: converus.com
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Converus provides scientifically validated credibility assessment technologies. EyeDetect® detects deception at 86-90% accuracy in 15-30 minutes by analyzing eye and other behaviors. IdentityDetect® detects falsified identities at 91% accuracy in about 1-3 minutes by analyzing subtle variations in the motor nervous system responses. These technologies help protect countries, corporations and communities from corruption, crime and threats. Converus is headquartered in Lehi, Utah, USA. Visit: www.converus.com
Converus Press Contact: Jeff Pizzino, APR /+1 480-606-8292