4 Reasons PII-Based Fraud Detection Systems Are Quickly Becoming Obsolete
The online marketplace is rife with bad actors, and your organization needs to expand its digital presence to remain competitive. Many companies use the same old formula for identity verification—offer an application for new users and decide whether they’re genuine based on the PII they submit. You may not know it, but fraudsters have been studying these digital defenses for years and are more than capable of getting past them. This leaves unprepared organizations open to fraud ring attacks, bot attacks, and more. However, there are innovative tools you can incorporate to modernize your new account fraud detection systems. Read on to learn about the pitfalls of PII-based systems and what strategies your company should use instead.
Compromised PII is Widely Available
Whether through data breaches, phishing attempts, or even more devious
means, the bad guys are constantly working to steal PII. Stolen and
otherwise compromised PII often ends up being sold on the darknet, where
it’s available to the highest bidder. The buyers aren’t exactly
altruistic, either. Once they get their hands on compromised PII,
fraudsters use it to fool digital identity verification systems and take
advantage of vulnerable organizations. One innovative method involves
combining pieces of PII from different users to create a synthetic
identity. Because all the individual details are genuine—although the
hybrid profile is not—a synthetic identity can be difficult to spot
using traditional tools.
Post-Submit Data Offers a Static User Analysis
Before a user can create an online account with your organization, they
must first pass a test: your application process. If you grade the
completed test without looking beyond the four corners of the document,
you have no way of knowing how the applicant arrived at their answers or
whether they tried to cheat. A completed application doesn’t
necessarily tell you anything about the person who filled it out. All
you’re seeing is who they say they are. By judging applicants
solely on their post-submit data, your organization is giving them an
opportunity to cheat on this test.
Bad Actors Are Evolving Their Methods
Unfortunately, you have more to worry about than individual fraudsters.
Fraud ring attacks, bot attacks, and a wide range of digital threats
plague the online marketplace. Some serious bad guys even do their
homework and learn about step-up verification policies used by their
targets. New account opening fraud is no joke, and by the time you
notice the signs of a fraud ring
attack, it’s usually too late. Plus, the detection tools used by many
organizations tend to lock out genuine customers in addition to bad
actors. According to one estimate, these false positives could cost
digital merchants nearly half a trillion dollars over the next two years
alone.
Behavioral Intelligence Offers Superior Fraud Detection
Instead of giving fraudsters a chance to cheat the system and hoping
you manage to catch them afterward, what if you could look over their
shoulder as they fill out their application and catch anomalous, risky
behavior in real-time? That’s precisely what cutting-edge behavioral intelligence
tools do. A genuine applicant typically would not have trouble
recalling their name, phone number, or email address, right? But if a
user filling out your form retypes one of these fields multiple times,
that’s likely a sign of a fraudster at work. By analyzing digital body
language and flagging risky behavior in real-time, behavioral
intelligence tools can enable rapid intervention by your step-up
verification systems and catch the bad guys before they even have a
chance to complete your application.
About NeuroID
It’s
a simple fact of doing business online: Bad actors are always sizing up
digital defenses and devising new strategies for taking advantage of
vulnerable organizations. Fraudsters develop increasingly sophisticated
methods of posing as genuine customers to slip past old PII-based
detection systems and target your company. But with the power of
behavioral analytics tools from NeuroID, you can seize the initiative
and detect fraud indicators before criminals have a chance to cheat you.
The groundbreaking technology in their ID Crowd Alert™ and ID
Orchestrator™ tools analyzes digital body language and pre-submit data
to spot risky activity in real time. With the ability to detect fraud
rapidly, your step-up verification systems can intervene and effectively
protect your organization.
Take your organization’s fraud detection to the next level with NeuroID at https://www.neuro-id.com/
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