Jul 10, 2017 Philip Burgess
The consequences of doing business with a fraudster or identity thief can be disastrous. At best, your company becomes the victim of embezzlement. At worse, you violate several regulations and could be subjected to heavy fines or jail time. As such, you want to avoid hiring or working with such individuals, but the resources and knowledge necessary to do so may be beyond what your internal systems are capable of.
The solution? Use comprehensive identity verification and authentication tools as part of your fraud risk assessment strategy. These solutions sort through countless records and use knowledge-based questions to confirm applicants - both potential employees and customers - are who they claim to be.
Who needs an identity verification service?
Employers, lenders and businesses each must adhere to certain federal regulations to remain compliant with the Federal Patriot Act. These rules require organizations to screen applicants against a number of anti-terrorism, anti-money laundering, sanction, foreign government and most wanted lists databases, lest they be subject to fines and possible jail time. Navigating these databases in-house requires a tremendous amount of legal knowledge and resources, making an identity verification service an ideal option. Additionally, identity verification falls in line with the Red Flags Rule and know-your-customer guidelines.
Moreover, identity verification and fraud risk assessment tools help protect companies from internal losses and keep them from becoming accomplices in criminal activity. In essence, almost any company that does business with individuals or organizations needs some form of identity verification process and fraud risk assessment.
What does an identity verification service do?
There are countless resources and databases used to check a person's identity, including:
- National Directory Assistance.
- The Social Security Administration.
- Credit bureaus.
- Wireless service providers.
In addition, financial institutions must check potential customers and employees against a long list of government records, including:
- The Office of Foreign Assets Control Consolidated Sanctions List.
- The Financial Crimes Enforcement Network List.
- The Directorate of Defense Trade Controls List of Statutorily Debarred Parties.
- The Profiled Fugitives List.
- The European Union Consolidated List of Sanctions.
"MicroBilt's Identity Verification tools ease burdens and reduce the risk of violating federal laws."
According to the U.S. Department of the Treasury, there's no single compliance program for assessing customers against these lists. Furthermore, few businesses, especially small ones, have the resources to sort through each and every one of these databases, searching for an applicant's name. In fact, many do not even have access to these lists, especially those involving foreign parties.
An identity verification service takes on this task instead, easing your burden and reducing the risk of violating federal laws.
How does identity verification protect businesses?
MicroBilt provides two types of identity verification services:
ID Verification searches multiple resources to confirm a person's identity before you hire them or accept them as a new customer.
- The ID Verify tool sorts through hundreds of millions of records across a number of data sources, collecting more than 60 different elements of an individual's personally identifiable information. It also provides a numerical score to quantify to the possibility of fraud. This way, you can be certain the person you're doing business with is exactly who they say they are.
- The Watchlist Search tool check's a person's identity against federal and international records to confirm the legality of working with that individual. With this option, you avoid conducting business with parties against which the U.S. has issued trade or economic sanctions.
ID Authentication lets businesses confirm an established customer's identity has not been stolen and used for a high-risk transaction. For example, it allows an online retailer to certify that a third party hasn't stolen a customer's credentials and will use them to make fraudulent purchases. MicroBilt's ID Authenticate uses a series of questions to verify information only the true owner of the identity would know, such as address history, asset ownership and other details. It then calculates whether the person in question passed or failed the assessment and gives the business the ability to confirm or deny access.
With these solutions, businesses and lenders reduce the risk of fraudulent activity and remain compliant with federal regulations.