Connect with us

Technology

The Fastest Growing Form of Fraud That’s also Hardest to Detect: Synthetic Identity Fraud

Published

on

The Fastest Growing Form of Fraud That’s also Hardest to Detect: Synthetic Identity Fraud

By Christina Luttrell, Senior Vice President, IDology

Synthetic identity fraud (SIF) is one of the fastest growing and most sophisticated forms of fraud in the United States today. The Federal Trade Commission estimates that SIF costs American businesses $50 billion each year and, unfortunately, it’s difficult to detect and even harder to stop.

First things first, are you up to speed on SIF?

Christina Luttrell

Christina Luttrell

While traditional identity theft involves a criminal targeting and assuming an individual’s entire identity, with SIF perpetrators combine real and/or fictitious information, such as Social Security numbers (SSN) and names, to create identities that they then use to defraud financial institutions, government agencies or individuals over time. At first glance, a synthetic identity appears unremarkable, and that’s the point. SIF criminals are in it for the long haul, which is why it’s sometimes called “sleeper fraud.” The longer an artificial identity remains “in play,” the larger the credit profile becomes and the greater the potential for criminals to profit. Successful synthetic identity fraud schemes evolve over months and sometimes even years before the criminal decides to “bust out,” cashing in on the identity and leaving the credit provider to foot the bill.

How did we get here?

When businesses in the United States adopted EMV chips in credit and debit cards, criminals were forced to channel their fraud efforts online. That migration, paired with large-scale data breaches, loosening credit standards and the exploitation of legacy credit creation practices and systems, laid the groundwork for certain forms of fraud to flourish, hence the recent exponential rise in SIF. In 2016 alone, SIF cost lenders $6 billion. Today, it’s also responsible for 20 percent of credit losses, with an average charge of $15,000.

There are several other factors that are contributing to the increase in SIF:

Social Security Number Randomization. Beginning on June 25, 2011, the Social Security Administration (SSA) changed how it issued SSNs. According to the SSA, randomization helps protect the integrity of SSNs as well as extend the lifespan of the nine-digit system. However, randomization eliminated the ability of legacy fraud detection solutions to use the information embedded within an SSN to determine its veracity.

Vulnerabilities of Legacy, Static Fraud Detection Tools.Along withthe challenges created by SSN randomization, many firms are also still utilizing conventional identity verification systems. These systems use simple, single-layer matching processes that are configured for yesterday’s fraud schemes. Criminals are constantly collaborating and innovating, and they have adopted more sophisticated cons that legacy systems can’t detect.

Difficulty of Detection.Because a synthetic identity looks and acts like a real identity, companies often do not realize they’re dealing with a fraudster.

Relaxed Credit Standards and More Authorized Users.After the “Great Recession” ended, tight credit standards loosened up and financial services firms aggressively sought more revenue to make up for less fee income. As a result, lenders enabled more authorized users on accounts. Fraudsters exploit this by recruiting and “piggybacking” off of legitimate card holders with good credit, adding themselves to the account as an authorized user, then building up the synthetic identity’s credit score. Making matters worse, they may also add new synthetic authorized users to their previously established synthetic identities, thereby extending and amplifying the scheme.

SIF Protection and Prevention

The first step in combating SIF is acknowledging that traditional, static approaches to detecting identity theft are insufficient. These legacy systems are geared toward matching an established identity and credit history belonging to a real person. As we’ve mentioned, that’s not how SIF works.

To protect against SIF, technologies and processes should be put into place that offer:

Multi-Layered Identity Verification.With consumer data accessible on the dark web, detecting and preventing SIF schemes demands an intelligent, multi-layered approach that pulls together an array of location, activity, device, digital and other identity attributes to validate customers. Predicated on a risk-based approach, powerful algorithms coupled with robust data sourcing and mining capabilities can provide companies with detailed analyses of the relationships and characteristics of identity data that far exceed the rudimentary matching of data elements with public records.

Dedicated Synthetic Identity Fraud Analytics and Tools.Deploying synthetic fraud tools requires big data analysis to identify the relationships between the identity attributes, as well as their veracity. While synthetic identities may appear as a complete and existing identity, the identity is ultimately an amalgam of disparate identity attributes.With a relational analysis of those attributes, inconsistencies that may indicate a synthetic identity can be identified and escalated for additional verification early in the process.

Photo Identity Document Verification.Real consumers usually have “proof of life” documents on hand, such as a driver’s license and passport. They also have smartphones. Synthetic identities may not have such credentials. Document verification and matching a “selfie” with a driver’s license or passport photo can differentiate a real customer from an artificial one. It also offers a way to onboard customers with much less friction.

Cross-Industry Collaborative Networks.Detection also depends on access to a collaborative network of companies united in the fight against identity theft. Mitigating SIF requires companies and industries to share data. By flagging data elements such as phone numbers, addresses and SSNs connected to previous fraud schemes and making such information available collaboratively, companies can receive access to real-time, actionable fraud data.

Synthetic identity fraud schemes exist due to inherent weaknesses in the processes that institutions establish and consumers follow to establish and build credit profiles. Until the credit creation and maintenance process changes, criminals will continue to manufacture identities with the goal of committing fraud. Given SIF’s reliance on both real and fake data, preventing it depends on being able to analyze multiple layers of an identity in order to determine the account holder’s actual existence and intent.

Technology

Holding Cloud To Account, How Cloud Adds Up In Financial Services

Published

on

Trends influencing the 2020 data storage landscape includeAI, mass adoption of hybrid cloud, object storage at the edge, and cybersecurity

By Dom Poloniecki, General Manager, Western Europe and Sub-Saharan Africa at Nutanix

Cloud computing and the deployment of increasingly cloud-native technologies is happening across every industry vertical. Even in industries where a degree of previous inertia existed such as legal and finance, the drive to cloud flexibility and scalability has become a primary driver for the technology fabric that firms in these markets run on.

As traditionalist operations in the legal trade start to undergo increasing levels of digital transformation, the weighty behemoth systems running financial institutions are also now being carefully and strategically replaced by more efficient, more flexible and more cost effective cloud installations. Now a proud owner of its sub-sector label and hashtag, FinTech is the new financial IT… and FinTech was born on the cloud.

As part of the Third Annual Enterprise Cloud Index report by Nutanix, a specific analysis of the 3,400 IT decision-makers questioned is now dedicated to examining how financial services organisations are using cloud technologies. Looking at the key data points related to Financial Services, we can start to understand the implementation, workload separation and (in most cases still, as of 2020) the migration issues that these firms are experiencing.

In the world of Financial Services cloud computing, the importance of an integrated and intelligently managed hybrid framework can not be overstated. Financial operations can of course draw upon the resource backbone of public cloud for their foundational operational technology requirements. However, they often still need to run a carefully deployed private cloud footprint commensurate with the privacy and security needs of any organisation operating in the financial sector.

The central importance of hybrid

Hybrid cloud and the use of Hyperconverged Infrastructure (HCI) is therefore a key cornerstone for Financial Services hybrid cloud development. This is the route to a cohesively managed hybrid cloud environment, where workloads are optimised according to the security, performance and compliance needs arising from the use case of the data and applications at hand.

The Nutanix Enterprise Cloud Index findings back this reality up and show that the majority (86%) of financial services respondents identify hybrid private/public cloud as the ideal IT operating model for their organisation. So much momentum is there now in this space that financial services companies are running more applications in private clouds than most other industries polled. Their reported usage of private cloud (39%) outpaces all other industries except for IT, tech and telecoms (40%).

As a further validating and driving factor here, HCI is the lower substrate technology behind the big public cloud offerings from Amazon, Google and Microsoft. So HCI and the wider hybrid approach is no longer perceived as ‘just’ a route to cost savings, which perhaps it was as recently as half a decade ago; it now represents an important enabling and facilitating technology to reduce complexity and increase scalability. In the hybrid cloud world where cost is no longer the main driver for cloud implementation, we can say that we have moved on to a point where we identify the ability to ‘achieve business outcomes’ as the primary driver.

HCI for modernised financial challengers

Given the growth of so-called ‘challenger banks’ shaking up financial services with new online services, extended customer loyalty offers driven through dedicated mobile banking applications and other fast-moving business models, traditional financial institutions have realised that they need to become altogether more agile.

Adopting hybrid cloud in Financial Services allows even older and more established firms to build scalable and easily managed private clouds as part of a hybrid cloud model. This scalability can be engineered for rapid growth when and where it happens, but it is also scalability that enables financial organisations to rein in compute resources serving banking products that have proved to be end-of-life and ultimately laid dormant or retired.

It’s important to remember that, as powerful as it is, cloud can still be a complex consideration, especially when aggressively deployed in an essentially hybrid mix of public and private cloud instances. The Enterprise Cloud Index found that for every aggressive hybrid design being deployed, there is an equally aggressive drive to deploy Hyperconverged Infrastructure (HCI).

This is because HCI helps accelerate cloud adoption by sharply reducing the time it takes to build the software-defined infrastructure necessary to support private cloud. It also supports the rapid capacity expansion that enables the scalability benefits of cloud technology. Nearly 50% of the financial sector respondents said they’ve either fully deployed HCI or are in the process of doing so. Another 38% said they will be deploying HCI within the next 12 to 24 months.

It is difficult not to mention the impact and legacy of 2020 and the global pandemic on the financial services technology market space. More than three quarters (78%) of financial services respondents said Covid-19 has caused IT to be viewed more strategically in their organisations. In addition, 50% of financial services respondents said they increased their investment in hybrid cloud as a direct result of the pandemic.

Choice: from the bank teller to the backbone

The key point we keep coming back to here is choice. As financial institutions will be working to offer corporate and individual customers the widest choice of products and services, so too will they need to gain choice of operational compute fabric in the shape of the cloud deployments that they do actually make. More specifically, it’s about these Financial Services businesses having the flexibility to concentrate on the delivery of strategic business outcomes quickly, easily and – crucially – without the need to keep within the limitations of a particular supporting IT model.

As previous Nutanix surveys have shown, companies consistently express a desire for the ability to run workloads in the infrastructure best suited to them, based on a variety of criteria. Be that wanting to enhance security; rapidly on-board new apps during takeovers and acquisitions; reach new markets with different compliance needs and so on.

Over the next five years, financial services organisations expect a significant drop of 13 percentage points in their use of non-cloud-enabled datacentre technology, taking them down to less than 1% penetration. As in almost all aspects of life, some products, tools and processes that we took as standard parts of the way the world works are eventually superseded.

Nobody uses a ‘flatbed slider’ paper-slip credit card reader anymore to take a payment – and nobody will use non-cloud financial services IT functions in the very near future. There may be a few archaic legacy hangers-on, but they’ll be nothing more than the exception that proves the rule. Hybrid cloud for our Financial Services’ future? That’ll do nicely.

Continue Reading

Technology

First of a kind Virtual Coffee Machine app with social meeting moments to support workforce wellbeing in a remote workplace

Published

on

First of a kind Virtual Coffee Machine app with social meeting moments to support workforce wellbeing in a remote workplace 1

Powell Software’s first in a series of wellbeing technology innovations help remote employees socially connect with colleagues and keep the workplace culture alive

As the third UK lockdown continues and many countries worldwide face severe restrictions, Powell Software, a global organisation creating digital solutions and tools for the digital workplace, has launched the first of its kind Virtual Coffee Machine, an application within Microsoft Teams to ensure employees stay better connected, positively engaged and take regular breaks while working from home.

With employee wellbeing at the top of the global workforce agenda for 2021, Powell’s Virtual Coffee Machine app positively connects employees through virtual chats to maintain a culture of togetherness, even when apart.

Replacing the absence of the in-person coffee catch up, HR can swiftly set up a Virtual Coffee Machine break within any Teams channel, encouraging employees to take regular short breaks while inspiring networking and socialising between colleagues.

Matthieu Silbermann, Chief Product Officer at Powell Software said: “The effects of the Pandemic have reshaped the Digital Workplace and research has found that three quarters of employers intend to shift some employees to remote work permanently. However, with one in five remote employees naming loneliness as their top complaint regarding work from home, reinforcing togetherness needs to be a top priority.”

Take a virtual coffee

HR can set up a Virtual Coffee Machine meeting within any Teams channel defining time, frequency and date, and number of people. The app then uses an algorithm that collects data from employees registered in Powell Teams, automatically comparing outlook calendars and generating meeting invites based on the criteria of the meeting. For example, if the Virtual Coffee Machine meeting criteria was set at a maximum of five people and ten people are available to join then two meeting invitations would be sent.

Virtual Coffee Machine consciously avoids one to one or full team meetings, focusing on creating intimate, short social breaks where employees can take time out to engage with colleagues in a positive digital space.  Colleagues can also ‘travel’ to differently located virtual offices across their organisation to meet colleagues for a coffee break in different virtual buildings.

Employees are unaware of who else will join the group until the event, to encourage different team members to meet, chat and get to know each other. The app automatically books an agenda and also suggests ice breakers like ‘what was the last film you saw or book’?

If a team member does not want to or cannot join a Virtual Coffee Meeting, they simply decline the meeting invitation.

Silbermann continues: “Powell Software is passionate about connecting employees to their organisation and to each other, ensuring that they have a positive and stimulating experience at work, every day. Remote workers need to be connected, they need to feel part of the company, the culture and feel able to socialise in the hybrid or remote workplace.

“Powell’s new Virtual Coffee Machine app is all about the employee. We all miss the little social moments at the office, whether they be at the coffee machine or the cold water fountain. Coffee Machine allows us to progressively see our workplaces positively come to life again in a virtual way, promoting connectivity, collaboration and employee wellbeing. It’s part of a bigger goal and series of initiatives to bring the virtual building to life.”

Continue Reading

Technology

Top 5 Ways To Lose Your Video Files

Published

on

Most Video Content Created in the Summer Months, Finds Veritas Research

There are lots of reasons why you can lose video files in your system or device. While some of these problems are avoidable, others are inevitable. Simply put, it is only a matter of time before the latter problems will be experienced. The major challenge is that most people don’t understand why their video files are either missing, damaged or deleted.

Are you amongst those mentioned above? Do you always ask why a video file can get lost, deleted or damaged? Don’t waste time to rack your brain on a such topic/matter. This is because you have come to the right place. This well-researched blog will provide you all the top reasons why you are losing your video files. Before thinking about which video recovery software to start using, it is recommended you know why files are getting lost in your system.

Power outage

This is a common problem that is responsible for loss of data. However, most people are yet to discover it. Have you ever noticed any situation whereby there is sudden power outage in your system? Simply put, your system suddenly shuts down. In such case, applications and other files (photos, videos, audios and doc) will be closed without any prior warning. The implication of this is that your video files are likely to get damaged.

Top 5 Ways To Lose Your Video Files 2

You may want to argue that systems come with batteries. Therefore, there will not be a problem of power shut down. This is not true in any way as power shut down can happen due to some reasons. It could even be that your system is malfunctioning. Even when your video files are not damaged through such incident, there is every chance that your hard drive will be adversely affected.

Faulty hard drive

If your hard drive is damaged due to one reason or another, there is every chance that your video files will be lost, damaged or deleted. Most of the cases related to data losses can be traced to malfunctioning hard drive. In case you don’t know, hard drives are very fragile. They can easily become faulty because of poor handling. If your hard drive crashes, it is recommended you find out what must have led to such problem. Trying to use a data recovery tool without knowing the root cause of the problem won’t do any good.

There are numerous factors responsible for a faulty hard drive. These could be hot system, frequent crashing, constant freezing, slow processing speed, booting up issues. The longer you ignore these problems; that is how your hard drive will be further damaged. This will in turn lead to loss of video files.

Human error

The truth is that as humans, we are always bound to make mistakes. These could sometimes prove very costly since they can bring about loss of video files. There are cases when important business files have been deleted mistakenly in the past. Human errors are very common. They can bring about formatting of hard drive, data loss and repair of system.

The only way to avoid this problem is to ensure you understand files to be deleted or retained. Most people don’t read messages displayed in dialogue boxes before clicking on “Delete” buttons. This is an easy way to delete important video files without knowing.

Computer viruses

Computer virus is one of the major reasons why people lose video files. Just as the digital world is becoming increasingly popular, viruses and malware are also waxing stronger. One of the most notable causes is when you begin to explore unsecured websites. It can also happen when corrupt files are downloaded and installed in your system.

When your system has been compromised by viruses and malware, there is a very high chance of losing vital files like doc, videos, audios and photos. You will try to open these files but they won’t respond. The best way to overcome this problem is using anti-virus software. This will help to monitor your browsing habit online.

Hard drive formatting

This happens to be another major cause of data loss. Most people format their hard drive without backing up vital files. In the end, these files are lost. Without the help of a paid or free recovery software, you may struggle to get back such data.

It is recommended that you backup important video files before initiating such a process. There are lots of ways to do this. For instance, you can use an external hard drive or even store such files online. This will save you the stress of spending unnecessarily on a data recovery software.

Final words

When it comes to losing your video files, there are lots of reasons which could be responsible for such problem. The tips shared above can help you to a great extent. All you have to do is ensure they are avoided.

 

This is a Sponsored Feature.

Continue Reading
Editorial & Advertiser disclosureOur website provides you with information, news, press releases, Opinion and advertorials on various financial products and services. This is not to be considered as financial advice and should be considered only for information purposes. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third party websites, affiliate sales networks, and may link to our advertising partners websites. Though we are tied up with various advertising and affiliate networks, this does not affect our analysis or opinion. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you, or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish sponsored articles or links, you may consider all articles or links hosted on our site as a partner endorsed link.

Call For Entries

Global Banking and Finance Review Awards Nominations 2021
2021 Awards now open. Click Here to Nominate

Latest Articles

Trends influencing the 2020 data storage landscape includeAI, mass adoption of hybrid cloud, object storage at the edge, and cybersecurity Trends influencing the 2020 data storage landscape includeAI, mass adoption of hybrid cloud, object storage at the edge, and cybersecurity
Technology23 mins ago

Holding Cloud To Account, How Cloud Adds Up In Financial Services

By Dom Poloniecki, General Manager, Western Europe and Sub-Saharan Africa at Nutanix Cloud computing and the deployment of increasingly cloud-native...

What’s in store for Financial Services in 2021? 3 What’s in store for Financial Services in 2021? 4
Finance34 mins ago

What’s in store for Financial Services in 2021?

By Miroslava Betinova, Head of Strategic Sales at PPS If there is anything that 2020 taught us, it is the...

Iron Mountain 2021 Outlook 5 Iron Mountain 2021 Outlook 6
Top Stories38 mins ago

Iron Mountain 2021 Outlook

By Stuart Bernard, VP of Digital Solutions at Iron Mountain The Covid-19 pandemic is continuing to rewrite the rules governing...

Capital Markets: The Last Frontier for Digital Transformation in Financial Services 7 Capital Markets: The Last Frontier for Digital Transformation in Financial Services 8
Trading54 mins ago

Capital Markets: The Last Frontier for Digital Transformation in Financial Services

By Dr. Avtar Singh Sehra, CEO, Nivaura The last decade has seen financial services undergo vast digital transformation. New technologies...

Worldline launches Data as a Service platform for online payments 9 Worldline launches Data as a Service platform for online payments 10
Finance1 hour ago

Worldline launches Data as a Service platform for online payments

The new service enables users to do more with their data and is paving the way for a more insightful...

Jack Henry shares six areas of focus for financial institutions in 2021 11 Jack Henry shares six areas of focus for financial institutions in 2021 12
Top Stories2 hours ago

Jack Henry shares six areas of focus for financial institutions in 2021

Reflecting back on 2020, the community banking and credit union industries should be proud of how this unprecedented pandemic and...

Voice Quality Matters: Quarter of Employees Working From Home Still Experiencing Regular Connectivity Issues 13 Voice Quality Matters: Quarter of Employees Working From Home Still Experiencing Regular Connectivity Issues 14
Business19 hours ago

Voice Quality Matters: Quarter of Employees Working From Home Still Experiencing Regular Connectivity Issues

-Survey of 1007 SMEs in the UK by Spitfire Network Services Ltd reveals pain points for employees working from home-...

Employee Ownership Trusts increasing in popularity amid a backdrop of continuing uncertainty 15 Employee Ownership Trusts increasing in popularity amid a backdrop of continuing uncertainty 16
Finance19 hours ago

Employee Ownership Trusts increasing in popularity amid a backdrop of continuing uncertainty

With 2020 behind us, the impacts of the COVID-19 Pandemic and Brexit are still being felt throughout the economy, and...

How the application network unlocks open banking’s future How the application network unlocks open banking’s future
Banking20 hours ago

Open Banking: the perfect pandemic tool – Equifax comments

With COVID-19 related financial fallout set to dominate the credit landscape in 2021, Dan Weaver, Open Banking Expert at Equifax...

How can we benefit from mandated e-invoicing? 17 How can we benefit from mandated e-invoicing? 18
Business22 hours ago

How can we benefit from mandated e-invoicing?

By Mark Stephens, the CEO of Blackstar Capital Electronic invoicing is at a tipping point. On the one hand, only...

Newsletters with Secrets & Analysis. Subscribe Now