Digital footprints in the modern world are just enough for perpetrators to execute their ill plans. Illegally acquiring data is no longer a problem since unprotected social media profiles can do the job well. Otherwise, data breaches, ransomware, and phishing attacks are also some ways imposters use to steal sensitive information. But what do they do with all the unauthorized data? Well, the answer is simple - identity fraud. Bad actors have become strategically strong and employ advanced technology for their ill gains. They use all the stolen information for identity theft, new account fraud, deepfakes, synthetic identity fraud, and many other frauds. Here are the top five identity frauds threatening businesses in 2021. 1. Identity Theft A recent identified that more than 1.3 million complaints related to identity theft from US consumers were reported in 2020. virtual meeting held by Congress Recently, a Miami woman named Danielle Miller was indicted in connection with allegedly filing for and acquiring pandemic-related loans and using the funds for personal expenses. Danielle was arrested on May 11, 2021, and according to the charging documents, the accused devised and executed a scheme to fraudulently obtain pandemic-related loans by the federal government including Economic Injury Disaster Loan (EIDL) funds through the SBA along with the Pandemic Unemployment Assistance (PUA) and related unemployment benefits. Miller used the Personally Identifiable Information (PII) of five individuals for account opening and applying for $900,000 SBA loans. (Read more details of the case ) here Several other cases have been reported this year and businesses are at high risk of fraudulent attempts. Companies that lack customer screening are at huge risk of identity fraud. 2. Synthetic ID Fraud Fraudsters create an entirely new identity by incorporating chunks of real and fake information. Half fake, half real information makes it complex for businesses to differentiate legitimate customers from imposters. Synthetic identity fraud was most prevalent in 2020 and it is disrupting businesses this year as well. A month ago, the US Federal Jury found three Encino guilty of fraudulently acquiring COVID-19 relief funds using stolen and synthetic identities. All defendants were guilty of committing bank fraud and wire fraud. The investigation also revealed that 11 counts of wire fraud, one money laundering conspiracy and eight counts of bank fraud were committed. With artificial intelligence and machine learning algorithms, not only businesses are reaping benefits but also bad actors are using the same technology to create fake identities that are hard to detect. 3. Deepfakes Using videos for fooling biometric authentication is the biggest identity fraud threat for the corporate world in 2021. Fake audios or videos altered through machine learning technology that is used for impersonating someone else are deepfakes. Back in 2019, a UK-based energy firm was tricked with a deepfake. The CEO of the firm was fooled into transferring USD 243,000 to an imposter. The threat of this identity fraud has increased ever since. Did you know business email compromise (BEC) fraud is set to be deadlier this year due to deepfakes? G2 reveals that perpetrators are now using deception instead of ransomware to divulge employees into sharing sensitive information. 4. New Account Fraud Perpetrators use stolen or synthetic identities to open a new bank or credit and loan account to borrow money just to disappear at the end leaving a trail of debt in the person's name. Apart from this, new account fraud is also used for money laundering. Around 3.2 million customers were affected by this fraud in 2018 according to a Javelin Strategy report. On the Dark Web, identities are sold for as low as $20 and many people do not even know their ID is stolen until it is misused in activities like new account fraud. 5. Replay Attacks Another identity fraud technique has emerged over time called replay attacks. A video of the victim’s face is played in a loop to fool the face verification system. The loop seems so natural that dodging the liveness detection system becomes easier for imposters. This spoof attack is more difficult to trace. What’s the Solution? While imposters are taking all possible steps to fool businesses and illegally acquire money, enterprises have one solution that can save them from financial losses and damaged brand reputation. An AI-powered identity verification system is what all the sectors need right now. This system verifies the identities of end-users by authenticating their government-issued identity documents like ID cards, driver’s licenses, and passports. Then, face verification checks are employed that use AI and ML to match the face of the individual with the image on the ID document. This step also ensures the live presence of the end-user and combating spoof attacks becomes effortless for businesses. Within a few seconds, companies can onboard legitimate customers, comply with rigid regulations, and keep fraudsters at bay. Apart from the speedy verification, the frictionless process is highly accurate and reliable. All in all, the prevailing identity fraud threats can be turned down with an AI-driven identity verification solution.

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Combating Top 5 ID Fraud Threats of 2021 with Artificial Intelligence

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