Taking a proactive approach is one of the best ways to fight fraud. Yet there is a common belief among some business professionals that a software used for fraud detection is the only type of software tool available (or necessary) for fighting fraud. Certainly, in your anti-fraud program, detection through monitoring can play an important role, but it puts you in a reactive mode. Instead, to better know the people and companies with whom you choose to do business, you should take efforts. In other words, in the first place, do what you can to help prevent fraud from occurring. Ongoing due diligence with monitoring will be combined in better anti-fraud programs, and with identity verification tools is the place to start. You should know your customers and for the same there are a variety of reasons. First, this is an excellent business practice to know your clients. With deceptive individuals, you can help prevent being associated, and that can save you money. From the particular business deal, such a relationship can lead to direct losses, but sending your good customers scurrying to the competition, it can also tarnish your company’s name. Second, to focus on those products or services that best meet your customers’ needs, knowing your customers allows you. You can build (or enhance) a competitive advantage, by doing those activities well. It can be done by social verification. In addition, to identify their customers, some companies face regulatory requirements. For example, subject to regulations calling for Customer Identification Programs (CIP) are certain financial institutions, and subject to the new Identity Theft “Red Flags” Rules are certain financial institutions. To help establish a customer’s identity, many banks collect documents such as a birth certificate, passport, driver’s license, or some other government-issued ID. Counterfeit documents or fraudulently obtained physical documents may not be spotted by the personnel and this runs a high risk. It is very critical to ensure your employees are well trained, but if your employee is presented with an unfamiliar identification document, what happens? Clearly, the fraud risk is higher, and with an employee unknowingly accepting counterfeit documentation, some fraud begins.
To compare data provided by the potential customer against public records to see if there are any discrepancies is one of the most popular ways to augment identity verification processes. If not for software solutions that can help you streamline the process, this “non-documentary method” could be very time consuming. In fact, this task can frequently be completed within seconds, using identity verification software. Identity Verification Software