The following post is provided by Experian, a MeridianLink partner.
The fraud landscape can be daunting with fraudsters constantly coming up with new tricks and sneaky ways to attack. If nightmares of fraud attacks have been keeping you up at night, you’re not alone. In Experian’s 2023 Identity and Fraud report, nearly 70% of businesses report that fraud losses have increased in recent years. While there’s no magic spell for making the fraudsters disappear, there are simple steps you can take to help combat fraud walking in through your front door when customers open new accounts.
Application fraud has become an even greater area of significant fraud attacks for businesses, and taking a multilayered approach to fight off the different types of criminals is crucial. There are lots of villains you need to think about, from identity thieves and online fraudsters, to synthetic identities and people who abuse their own reputations to steal from you. It can be overwhelming to find a starting point, so below are three easy steps to help you lock out fraudsters from the start.
- Identity verification and eligibility – Confirming that a provided identity represents a true, unique individual is the first step in protecting your members. Most verification tools can also recognize patterns of identity use that are normal and consistent with the owner’s behavior and when they are not.
- Fraud risk assessment – Analytics that can detect a wide range of fraud risks and fraud types is another great layer to add to your defense. Employing highly predictive fraud models can help to better identify fraud risk and then properly treat the type of fraud. There are three core types of identity fraud that you need to look out for – identity theft, synthetic identity, and first-party fraud. Each of these fraud types has a different motivator behind them, and being able to detect which type of fraud they are trying to commit can help you come up with the best plan of action to mitigate it.
- Step-up verification – Balance identity risk with the customer experience through an array of reliable verification capabilities to manage risk with the least possible amount of friction. The one-time-password (OTP) process is simple and secure – and frustrating for fraudsters. The technology delivers a numeric passcode to the consumer via a mobile device that has been verified as belonging to the consumer.
Verifying a person’s identity and eligibility up front can save you many headaches with little to no friction for the customer’s experience.
There are many ghouls, monsters, and villains out there, but there are easy ways to enable and grow your digital business while proactively safeguarding against fraud. Protect your members and your business using a layered best-in-class identity and fraud prevention solution to prevent multiple types of first-party and third-party fraud, including identity theft, synthetic identities, fraud rings and first payment default.
To channel your inner “Buffy the Fraud-Slayer” and learn more about how to take fraud head-on, visit https://www.experian.com/business/solutions/fraud-management.