As a lowest common denominator fraud prevention technique, organizations can rely on identity document verification even when other risk management checks or identity data is unavailable, outdated or inconclusive.
Sarasota, Florida (PRWEB) November 21, 2014
What does it mean to refer to identity document verification as a lowest common denominator risk management technique? Simply put, it is a technique that can often be applied globally and can almost always provide a conclusive signal of risk as long as the consumer has a form of identification or other document that can be accepted for verification. In this context, organizations can rely on identity document verification even when other risk management checks are unavailable or just aren’t providing results that enable the merchant to feel confident in their decision of how to handle a given transaction.
When doing business online it is important to establish an electronic identity (e-identity) or profile for each customer based on the identity information the consumer provides. Due to the high degree of anonymity online, it is wise to authenticate and verify this information with other sources, but accurate data isn’t always available. Often there can be inconsistencies in data or there is no data available for consumers who have moved recently, cohabitate with non-family members, are transient or use only a prepaid mobile phone with no mobile or landline subscription service. These are just a few reasons among many why reliable data may not be available for a particular consumer.
In the latest feature article titled “Identity Document Verification as a Lowest Common Denominator Risk Management Technique”, The Fraud Practice discusses how many types of online organizations can benefit from using identity document verification as a secondary form of screening only when required. Because of its global applicability and ability to provide an indication of risk when identity data is otherwise not available for a consumer, identity document verification is something merchants can fall back on as a lowest common denominator risk management tool.
Additionally, the global coverage of identity document verification allows for more consistent operational processes and transaction flows for consumers worldwide. As a lowest common denominator fraud prevention technique, identity document verification allows organizations to expand their reach with a streamlined workflow similar for all markets, instead of using a multitude of data signals and services which vary in accuracy, availability and effectiveness.
Michael Hagen, CEO of IDchecker, elaborated that identity document verification “can benefit many different types of organizations as it enhances identity fraud detection, especially in markets where available risk management services or access to identity data is limited.” Hagen then cautioned that “for maximum coverage and global applicability it is important to consider not only the total number of countries covered by an identity document verification service, but also the variety and total number of documents that can be accepted.”
Too often organizations associate identity document verification with the banking and financial services industry, KYC and AML compliance, and other applications where it is used as a primary risk screening and verification technique. It is important to consider, however, that many other online merchants can benefit from using identity document verification as a secondary form of screening when kept on hand as a lowest common denominator fraud detection technique.
For more information, see the latest article from The Fraud Practice: Identity Document Verification as a Lowest Common Denominator Risk Management Technique
About The Fraud Practice
The Fraud Practice is a privately held US LLC based in Sarasota, Florida. The Fraud Practice provides consulting services on eCommerce payments, fraud prevention, and credit granting as well as prepared research and training for payment and fraud professionals. Businesses throughout the world rely on The Fraud Practice to help them build and manage their payment, fraud, and risk prevention strategies.