Automated Biometric Fraud Prevention Processing
As part of an increasing effort to fight financial and credit fraud, financial institutions are using new forms of data aggregation to protect themselves. Even in the wake of the widespread U.S. adoption of the EMV chip card technology, the U.S. faced nearly $32 billion lost to fraud in 2014 – a 38 percent jump from 2013 – according to a LexisNexis study. The Federal Financial Institutions Examination Council urges banks and credit unions to abandon outdated methods of customer authentication like signatures and passwords and instead opt for “multi-layered, multi-factor dynamic forms.”
One such strategy is the use of biometric markers to establish identity. This can take many forms, is already in widespread use across the globe by in government and consumer applications, and is uniquely suited for multi-layered authentication systems.
Already seeing widespread use in commercial products like smartphones, fingerprint technology is one of the oldest and most common biometric identification systems. TouchID has been shown to be at least marginally more effective than traditional passwords and keycodes, but is still, according to Sandeep Sood, CEO of Monsoon Company, “in infancy.”
“More reliable than fingerprinting, voice identification is already in use by government intelligence agencies around the globe.”
More reliable than fingerprinting, voice identification is already in use by government intelligence agencies around the globe. Sophisticated systems already exist that would allow a bank, credit union or prepaid company can accurately identify and authenticate a customer in real-time. And unlike even fingerprints, a person’s unique voice cannot be compromised or stolen. Voice ID systems can even ask for unique word combinations, making it impossible to use stolen voiceprints and voice recordings.
A feature of spy movies, the retinal or iris scan is a viable biomarker technology whereby the system casts an unperceived beam of low-energy infrared light into a person’s eye as they look through the scanner’s eyepiece. This beam of light traces a standardized path on the retina, thus identifying physiologically unique patterns.
While a highly secure biometric, the technology also may struggle to process the data it takes in, leading to frequent false rejection. In this regard, it has not been positioned for use in commercial and financial applications, instead typically found in environments requiring exceptionally high degrees of security and accountability such as high-level government, military and corrections applications.
Is it enough to prevent fraud?
Even as biometrics see increased adoption, a new generation of hacker is working to undermine the security of these systems. According to a report by ComputerWorld UK, these “biometric fraudsters” use impersonation and obfuscation to crack even the most sophisticated biometric modalities. To combat this, most agencies advocate the use of a multi-factored system, much like the card and PIN system. A mixture of voice and fingerprint may be able to stymie fraudsters who have managed access to one biometric.