Detect and prevent fraud

You might think that adding real-time checks to your credit application would increase processing time, but that’s not the case. Implemented correctly, this type of authentication doesn’t lengthen or disrupt the customer journey for genuine applicants, but it does give you peace of mind. In 2020, Experian’s Hunter detected 1.2 million suspect applications.

More data means more fraud detection. That’s why it’s essential to cross-check applications against as many relevant data sources as possible in a single process. Experian’s Detect, for instance, checks over 100 million records the moment an online application is made. Hunter, which integrates with Detect, matches application data against multiple sources, including your own fraud data, shared fraud databases, mortality data and dedicated ‘watch lists’.

There’s no point in having a powerful solution if you don’t understand the results. There are different approaches you can take with this issue. With Detect, Experian has drawn on its data analysis and scorecard experience to create a simple Fraud Index to highlight any applications that require manual checks. Hunter, on the other hand, has a fraud risk engine that pushes suspicious applications to its investigation workbench tool, an interface you can use for further analysis and action.

Robust verification solutions reduce the financial impact that fraud can have on your business. Spotting fraudulent applications early means you don’t lend to fictitious people. In 2020, Experian’s Hunter saved its clients £4 billion in fraud¹. Real-time verification also ensures that genuine applications are processed quickly so that you don’t lose customers to impatience or your rivals. 

By building a profile of the devices each customer uses to access their account, you can highlight possible fraudulent attempts to take over a customer’s account and challenge any suspicious activity before it causes damage. Experian’s FraudNet also uses device intelligence to recognise when multiple transactions are being spawned from a single device. It can also differentiate between individual devices regardless of past activity, presented credentials or the connection used – all details often be spoofed by fraudsters.

Another key way of preventing ATO fraud is to compare ongoing transactions against global fraud databases. Real-time pattern-matching algorithms flag up any known fraud incidents or other irregularities that match your transaction, including highlighting devices used in previous confirmed ATO attempts. Experian’s CrossCore includes known fraud checks alongside device intelligence and behavioural biometrics.

If you want best-in-class ATO protection without adding friction to your digital channel, you should be considering behavioural biometrics. This modern detection method enables organisations to analyse complex online behaviour by looking at real-time interactions between people and their devices, such as typing speed, scrolling and swiping patterns as well as their interaction preferences – for instance, whether they navigate via a search engine, chatbot or by browsing. If any abnormalities are detected, the activity is flagged as suspicious.

To predict the likelihood that transactions are being made by the actual account holder, you need AI modelling to combine all the above checks. Experian’s CrossCore uses machine reviews all the various risk factors to calculate an overall probability of fraud. Organisations can use this to determine how they deal with the transaction based on their business model and risk appetite. 

One tool in your arsenal against fraud is device intelligence. This  your system differentiate individual devices without being fooled by spoofed credentials, connection data or past activity. Smart device verification helps you assess the probability that your customer is who they say they are so that you can challenge suspicious behaviour. Experian’s FraudNet harnesses device intelligence to identify every device visiting your platform and works without the use of tags, cookies or Flash Objects. 

Device intelligence can also highlight inconsistencies relating to a device’s use and flag up when a single device attempts to make multiple transactions. This lets you act quickly before you or your customers are affected.

It’s also possible to flag potential fraud by looking at real-time interactions between people and their devices, such as their typing speed, scrolling and swiping patterns along with their preferred methods of interacting with a platform. Known as behavioural biometrics, this approach uses sophisticated artificial intelligence routines and can be found in products like Experian’s CrossCore.

By using effective intelligent device checks alongside behavioural biometrics you can reduce long-term attack rates because frustrated fraudsters move on to more vulnerable targets.

Deciding to do business with a new commercial client always comes with risks, but you can reduce them. The key is to improve your data so that it gives you a more rounded view of B2B prospects. Experian’s Commercial Fraud upgrade your records with an up-to-the-minute feed of consumer, commercial, identity and fraud data. This gives you the insight to authenticate any business, check on its owners and accurately identify commercial fraud.

Another potential  comes from businesses whose accounts are either in arrears. Thankfully, enriched data can also solve this problem by identifying commercial prospects with unhealthy balance sheets.

Complex business structures sometimes make it difficult to know who you’re dealing with. What you need is relevant, accurate and up-to-date information so that you can make quick and consistent customer assessments to meet AML and KYC requirements. Experian’s Financial Crime Compliance Solutions let you regularly risk assess your back-book to validate businesses in your existing portfolio. They also assist with real-time customer verification during onboarding, so you only accept the B2B clients that you want.

Sadly, you can’t just rely on checks carried when a new customer applies for credit. Fraudsters may already be lurking on your client list. If they are, there’s every chance they suddenly disappear leaving a huge debt in their wake. Finding them at that point will involve a costly collections operation that may not even succeed in recovering the debt. That’s why you need to regularly screen existing customer records for signs of fraudulent activity.

As with other types of fraud checks, having a wide range of comparative data is key to spotting suspicious activity. Experian’s Fraud Assessment for Open Accounts service matches information in customer records to a range of data sources, then creates a score based on the potential for fraudulent activity. Sources include Experian’s own modelled data, credit application information, death records, known fraud lists and more.

Using Experian's Fraud Assessments for Open Accounts also helps boost efficiency because its simple score system makes it easy to prioritise which cases should be investigated and to allocate resources effectively. If you want to impress your boss, a tool that can help you manage your caseload is crucial.