Fraud continues to be the monster under the bed for many businesses, but with new technology, there is hope. In 2022 fraud alone cost Australian businesses $3.1 billion. As 2024 is on track to be the biggest year for fraud yet; how can you protect your business? 

The short answer is the right identity verification provider.

‍Firstly, What is Identity Verification?

Identity verification confirms your customer's identity through official documents like passports and driver's licences. This ensures your customer has not committed fraud and helps mitigate risk. 

Common misconceptions

1. Identity verification is only for financial institutions: It is crucial in many other sectors, including healthcare, online retail, telecommunications and more.
2. It is a lengthy and complex process: Modern technology has streamlined identity verification through methods like biometric verification, which can be completed in seconds.
3. Personal information is always at risk during verification: Reputable companies use robust security measures and encryptions to ensure data protection and safeguard personal information mitigating the risk.

Benefits

Identity verification ensures you comply with evolving regulations. For example, entities within financial, gambling, and bullion industries must enrol with AUSTRAC. Entities include account and deposit-taking services, remittance services, and more.

Prevent high-risk customers:

The verification process also allows for the detection of high-risk customers. With this detection, you can report suspicious individuals again, complying with the new AUSTRAC regulations. 

To take it one step further, biometrics add an additional buffer of protection. This process requires users to provide multiple forms of identification. For example, a customer can provide a photo of their driver's licence and a selfie (much like those taken and used for face ID on your phone).

Biometrics help with early intervention, enhancing security with a multifactor authentication model, increasing compliance with regulations, and allowing companies to respond to suspicious individuals quickly.

Data Security and Privacy

Identity verification often requires businesses to hold the data of official personal documents. This information has been commonly mishandled in the past, leading to breaches of data and trust. This was seen in the 2023 Medibank data breach, where former and current customer names, dates of birth, addresses, and other personal information were leaked.

Personr helps mitigate this risk by holding the personal information for businesses securing data storage.

Solutions 

Personr’s client verification solution helps businesses detect fraud while complying with Know Your Customer (KYC) and Anti Money Laundering (AML) regulations. Here’s what it can prevent:

Money laundering and terrorist financing

AML legislation requires regulated industries to detect and report suspicious people and activities to governing bodies. Customer Verification employs algorithms using AI and machine learning to detect unusual or high-risk individuals that could be related to Money Laundering and Terrorism Financing. By quickly identifying and submitting suspicious activity reports, regulated institutions reduce the risk of money laundering, which can lead to significant financial and reputational damage.

Regulatory penalties

Personr’s client verification ensures any business regulated by KYC and AML legislation maintains full regulatory compliance, reducing the risk of costly penalties and regulatory actions.

Insecure data handling 

Personr adheres to international standards like ISO27001 and SOC II Type II that often dictate specific standards and protocols for collecting and handling personal data. This standardisation ensures that businesses gather only the necessary information in a secure and consistent manner, reducing the risk of collecting superfluous or sensitive data that could be vulnerable to misuse or theft.