One of the greatest challenges comes from the fact that merchants are forced to work in silo. Fraudsters attack multiple sites in dizzyingly quick succession. They specialise in particular industries, and they work together. Against all this, fraud prevention teams struggle to share information beyond high level trends and best practices.
There’s good reason that collaboration on a data level hasn’t been possible until now – and that’s the second challenge. It has become increasingly clear that privacy is now a major consumer concern, backed up by game-changing regulations: GDPR, CCPA, and so on. Fraud fighting gets some exemptions, but there isn’t a single industry unaffected by the new wave of privacy law. It’s a factor in everything now – balancing innovation against privacy. And as we mentioned in our recent webinar, that’s especially relevant in fraud prevention, where innovation is absolutely vital in order to keep up with fast-moving fraudsters who become more sophisticated all the time.
What should both businesses and consumers be aware of when it comes to the evolution/sophistication of the fraud environment?
I think the key thing to understand is the breadth and depth of the criminal ecosystem that we’re now facing (both as businesses and as consumers). Fraud is now, by and large, a professional matter. Fraudsters work in offices for businesses with hierarchies and organisation. Criminals specialise in different areas, from script writing to phishing to leveraging stolen loyalty points and much more.
In the online criminal world there’s a level of creativity, innovation, and technological development that rivals anything we see in hi-tech or the startup world. Businesses get excited about increasing scale and efficiency with automation and AI, but the fraudsters have been doing that for years already. They don’t have to wait for approval, they don’t worry about conforming to regulations. They move fast and they’re happy to break things because, usually, the things they’re breaking don’t belong to them.
Take the example of biometrics: many businesses are very enthusiastic about the potential of face and voice recognition for identity validation. It’s considered cutting edge. But look at deep fakes: the technology is already there to subvert this kind of biometric data and undermine its value for verification. It’s just my opinion, but my guess is that facial and voice recognition might fail for this purpose before they ever become widely adopted. The more widely they’re used, the more incentive fraudsters have to break through them; and as I say, the workarounds already exist. It’s not even that the introduction of a new defence is inevitably followed by the creation of an ingenious attack against it – the defence and the attack are actually developing in parallel.
Could you share with us any development plans that Identiq has for 2020?
We already have some huge online names committed to the network. In 2020 their collaboration, powered by the Identiq network, will grow to full fruition. We intend to be very customer-driven when it comes to product development; after all, the whole point is that it’s a network, enabling companies to collaborate against fraud. Of course early members have the greatest impact on the direction that the product takes and it’s been very rewarding to see how enthusiastic many companies are about helping to shape the network. We’re very excited to see where their needs and our technology, and our combined ideas and energies, take us!
For more information about Identiq, and how privacy-preserving peer-to-peer collaboration could help your business, check out our recent webinar.
About Uri Arad
Uri Arad, Identiq’s co-founder and VP Product, has been fighting fraud and fraudsters for more than a decade and has seen the fraud and identity challenge from diverse perspectives: product, risk, and R&D. He has tremendous experience building cross-functional teams, which use the latest technological developments to create innovative products that both reduce loss and improve customer experience. Uri's expertise extends both to analysing and meeting business needs, and to an in-depth understanding of the technology that makes improvement possible. He has a Master’s Degree in Computer Science from Tel Aviv University.
About Identiq
Identiq is a completely anonymous identity verification network that allows its members to validate new users, and vouch for ones they already know, without sharing any customer data or identifiable information whatsoever. Identiq is a providerless solution, enabling peer-to-peer collaboration. Companies can leverage the Identiq network to reduce false positives, increase approval rates, create a better user experience and guarantee absolute end-user privacy.
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