Identity Verification – Helping Industries Stay A Step Ahead of Criminals


The need for accurate identity verification is increasing to bring in effective mechanisms for the prevention of fraud. Criminals are using advanced methods to reap illicit benefits from industries like finance, healthcare, e-commerce, and various others. They commit identity theft for several activities.

In this technologically evolving world, industries should employ robust identity verification services to combat sophisticated criminal attempts. Regulatory authorities both regional and global are enforcing strict Know Your Customer (KYC) regulations on industries. As per these standards, businesses should verify identities prior to onboarding, else they might face hefty non-compliance penalties. The blog provides brief details regarding the industries liable for performing accurate ID verification.

Know Your Customer (KYC) Regulations – Industries Liable for Validating Identities

Technological advancements are bringing innovation to industries’ identity verification and other operations like digital banking, online purchase by scanning faces, and hassle-free boarding at airports. However, as per Shufti Pro News, these shifts have simultaneously increased the chances of fraudulent attempts. Criminals use advanced methods like photoshop to forge documents and commit identity theft. This helps them bypass the identity authentication process and illegitimately onboard platforms.

Keeping this in view, regulatory authorities are revamping strict regulations and non-compliance penalties. Therefore, industries like finance, e-commerce, healthcare, and others require effective solutions to make sure they are assisting legit customers. The next section contains further details regarding the industries and how they should verify customers to stay compliant with the regulations.


Financial Institutions – The Main Attraction for Criminals

ID verification is becoming more than ever crucial for financial institutions as they are bringing advancements to their operations. For instance, online transactions, digital payment methods, and paperless purchasing. Criminals on the other side, are using sophisticated methods to commit identity theft and data breaches. They use the information for opening fake accounts. Therefore, banks and other financial institutions should develop effective identity verification services to counter criminal threats.

As per the AML regulations, financial institutions and businesses are mandated to assess risks customers possess through accurate ID verification. Otherwise, they will be exposed to threats like money laundering, corruption, terrorism funding, and ultimately hefty penalties. Therefore, institutions like banks, insurance firms, investment companies, and other businesses need to employ identity verification services.

The AI-powered solutions provide real-time identification while allowing institutions to access global databases. This helps institutions to verify customers in the minimal time while keeping track of their activities to detect suspiciousness and report them to authorities.

E-commerce Businesses – Easy Target for Cybercriminals

Along with the rest of the other sectors, the e-commerce industry is also evolving by offering online identity verification, purchase and payment options. This has made room for cybercriminals. They commit data breaches and synthetic identity fraud to purchase restricted products and make payments by using cards of some other customers.

Therefore, information and document verification is not enough for the e-commerce industry, they should employ a biometric identity verification system. This helps vendors and retailers to perform identity verification by employing various checks like facial verification, voice recognition, and fingerprint cross-match.

Lack of effective verification measures and a history of breaches lead to customer drop-off and lack of trust. Ultimately, e-commerce platforms face reputational damages and hefty non-compliance fines. Therefore, e-store should not only perform ID verification but also validate addresses to mitigate the chances of abandoned carts and chargebacks.

Healthcare Industry – Favorable Platforms to Commit Medical Fraud

Healthcare providers are providing digital onboarding solutions to patients so that they can conveniently avail medical assistance. Since the pandemic, the operations are no longer the same, healthcare centres are offering “telemedicine” which is a form of visual medical assistance so that patients can skip the hassle of long ID verification queues.

However, these transformations are raising other challenges like identity fraud, data breaches, false medical claims, prescription fraud, and fake payments. Criminals use the information of legit customers to cover their treatments and avail government-based health benefits. Furthermore, fraudulent digital onboarding attempts to expose sensitive information of patients can bring fatal consequences. Therefore, medicare centres need to incorporate accurate identity authentication solutions.

Government Sector – Formal Place for Fraudulent Claims

Similar to the rest of other institutions, the government sector is also not safe from criminal threats. The most prominent in this category is identity fraud. As of 2020, the US lost over $200 billion to fraudulent governmental claims. For instance, the state provided benefits, unemployment, and other financial assistance. Criminals use fake information and documents to bypass the identity authentication process and illegitimately apply for benefits.

Shufti Pro Funding indicates that with an accurately verified identity, a governmental organization can ensure that the right citizen is claiming the benefits.

In Summation

Criminal threats are exposing global industries to various consequences ranging from customer drop off to hefty non-compliance fines. This is why the need for robust identity verification services is immensely increasing. Therefore, industries should employ AI-driven identity verification services to ensure they are not falling prey to illegitimate industries and providing assistance to the right customers.