BioCatch argues synthetic identity fraud renders static identity elements useless

The success of synthetic identity fraud is making the verification of static identity elements largely useless to prevent fraud, and should be replaced with behavior-based identity proofing, according to a blog post by BioCatch.

In a post on “How Insurance Companies Can Defeat Application Fraud”, the company says that the biggest threat to insurers offering services online is new account fraud, which plays a major role part in losses in non-health insurance estimated at $40 billion a year by the FBI. Relying on personally identifiable information (PII) has become ineffective due to data breaches that have made it a readily available commodity.

BioCatch cites a report by Javelin Strategy and Research which says “verifying static identity elements is now a largely useless tactic in preventing fraud.” In order to determine that the identity being presented truly belongs to the applicant, BioCatch says identity proofing can be done through behavior by examining application fluency, as fraudsters tend to demonstrate uncommon familiarity with the sign-up process, the use of keyboard shortcuts and function keys that indicate user expertise, law data familiarity, which leads fraudsters to cut and paste data more frequently than legitimate users, and machine and bot activity.

Shortly after signing up seven large banks in Latin America in October, BioCatch placed 12th on Deloitte’s annual Technology Fast 500 list.

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