Governments need digital ID verification strategies to beat rampant fraud

“The concept of digital IDs is relatively straightforward”: so says a piece in Nextgov/FCW, covering fresh legislative efforts to win the government a larger role in developing digital identity ecosystems. Congressman Bill Foster, D-Ill., wants the Improving Digital Identity Act included in the House AI Task Force’s list of recommended policy proposals. The proposed legislation calls for the use of “consent-based digital identity solutions” to enable Americans to prove their identity online.

Foster says he is motivated by the same spike in identity theft and cyber fraud that haunts IT and data security professionals. Tens of billions in losses from fraud related to COVID benefits have left financial firms spooked. Deepfake audio and video are a growing threat, requiring an additional layer of authentication. Companies are eager for new solutions to the deluge of identity fraud.

However, Foster believes that the key is not trying to out-innovate fraudsters with advanced fraud detection tools, but to “provide people with at least the ability to prove they are who they say they are and not a deepfake.”

In other words, reliable remote digital identity verification is not just one of the major benefits of digital ID – it is also the best foundation for secure digital transactions and a larger ecosystem of public trust.

And financial organizations are hungry for it. Foster expects that “as soon as the government defines a standard that works nationwide for authenticating yourself to the different agencies – and potentially the states – that industry will immediately jump on that as a standard that they will accept for things like opening bank accounts.”

Foster’s digital identity proposal would create an ‘Improving Digital Identity Task Force’ within the Executive Office of the President to expedite the development of secure digital identity credentials. The hope is that the law could add momentum to the adoption of mobile driver’s licenses (mDL) across the U.S. Several states already offer mDLs, and while the progress has been slow, the Improving Digital ID Act could serve as a catalyst for additional uptake of mDLs and other digital credentials nationwide.

Stop fighting the last war and embrace biometrics, says Reuters

A blog published by Thomson Reuters, titled “Why government agencies need a better identity verification strategy,” suggests that governments need “to consider more rigorous and more up-to-date verification strategies, such as biometrics and device identification.”

In keeping with the theme, the piece also notes how fraud “exploded during the pandemic as bad actors unlawfully accessed government benefits and financial support initiatives.” Knowing the risks is crucial, especially given the rapid pace of innovation by fraudsters. Safeguards that were once considered acceptable – knowledge-based authentication (KBA) and multifactor authentication (MFA) – are, at best, not likely to hold up much longer.

Besides, says the piece, “in some respects, that’s fighting the last war.” Focusing instead on developing “a rigorous identity verification strategy that verifies identities at the front end” will  prevent government entities from having to “investigate fraud after the fact and attempt to claw back illicitly gained benefits and funds.”

Friction, of course, is a problem. The customer may not always be right, but their experience must always be considered in the drive to promote uptake of a new technology. Reuters says “it is critical that government agencies establish a preventive identity solution while not making it difficult for citizens to obtain the services and benefits they need.”

So: a secure, front-end, frictionless identity verification system that preserves privacy and protects against evolving threats. Relatively straightforward, indeed.

Article Topics

biometrics  |  digital identity  |  fraud prevention  |  government services  |  identity verification  |  mDL (mobile driver's license)  |  U.S. Government