Whether it’s a digital transaction or opening an account, people expect security checks to be transparent and unobtrusive. Creating friction in the process makes it more likely that users will abandon an online application or contact support through another channel. This friction costs businesses time, money and ultimately customer satisfaction. That’s why it is important for digital businesses to ensure they are using the best tools and approaches for new account fraud detection.
New account opening fraud open accounts with the aim of committing a variety of crimes, from iGaming to dating to e-commerce. Criminals often use a falsified identity (invented or stolen) to pass the identity verification and onboarding checks required by a financial institution, then use the newly-created account to commit crimes. Criminals typically target financial institutions, iGaming sites and e-commerce platforms for their ease of access to funds or credit, as well as their high-end products and services.
Cracking Down on Deception: Strategies to Combat New Account Opening Fraud
New account fraud detection can be boosted through technology such as passive liveness detection, which ensures that an image of a human is captured in real life and hasn’t been faked with high-resolution printouts or pre-recorded videos. This can be complemented by other technologies that check for phishing links and other suspicious activity such as a lack of a consistent, stable facial expression or an inconsistency between the person’s face and body.
Many scams revolve around making deposits on bank holidays, then executing withdrawals before the deposited checks are processed and returned by the bank. To help prevent this, it is important to keep up-to-date with cybersecurity updates and regularly run background checks – which should always be reported when found, if data protection laws allow.