In this interview, KYC, Financial Crime & AML Solutions specialists Peter Chan and Simo Buzanin share some key insights around how illion can help you minimise the risk of identity theft.
According to the Australian Institute of Criminology (AIC),the annual economic impact of identity crime exceeds $2 billion, with 1 in 4 Australians falling victim at some point in their lives. To mitigate these losses, as well as the reputational damage of identity crime, it is critical for businesses to know who their customers really are.
We are joined by KYC, Financial Crime & AML Solutions specialists Peter Chan and Simo Buzanin, who are here today to answer questions submitted by you and share some key insights around how illion can assist.
What industries have you seen have the largest impact of identity theft?
Peter Chan: Banking, financial services and telcos are generally the most targeted sectors due to high-value assets and a highly digital customer onboarding experience. We are also seeing a huge increase in fraud recently across other sectors, that historically haven’t had much exposure and therefore are seen as easier targets, due to less sophisticated systems and processes to protect themselves.
Are there any industries that have surprised you that have been experiencing identity theft?
Simo Buzanin: Yes, I think it’s no surprise that inflation has made many things a lot more expensive than in previous years, hence these products and industries are becoming a focus for fraudsters. We are seeing fairly sophisticated attacks on industries dealing with construction and materials and in many cases, what appears like a staged approach to build trust before defrauding the organisation.
What have you observed over the past couple of years when it comes to business challenges with managing identity fraud?
Simo Buzanin: A lot of businesses have onboarded customers digitally during COVID and in many cases without a fully thought through solution. Unfortunately for many businesses it was the only way to operate during lockdowns. We are seeing gaps appear in KYC/KYB onboarding processes that leave businesses vulnerable to fraud and in most instances, it’s only discovered well after the fraud has been committed.
What challenges do you see being presented to organisations in 2023 and how can they protect themselves and their customers?
Simo Buzanin: We are seeing an increase in fraud and sophistication around some of the attacks that are targeting businesses with particular vulnerabilities and gaps. We have been working with a number of clients and partners to help create solutions to combat this and also improve customer experience. Many of our solutions are fairly easy and cost effective to implement and we do have tools to conduct ‘health check’ assessments, identify vulnerabilities and make their process more efficient and robust.
How would clients know if this would affect their business?
Peter Chan: If you are dealing with customers digitally, there is always a risk of customers applying who are not who they say they are. Fraudsters are continually finding smarter ways to bypass ID verification and are constantly looking for easy targets with unsophisticated processes to achieve this. Some are even brave enough to apply for bank accounts in-person using fraudulent ID documents.
Why should businesses be concerned?
Simo Buzanin: The impact of fraud and stolen identity is incredibly damaging not only for the customer, but also the organisation involved. The reputational damage for the organisation, executives involved and directors is real, not to mention the impact on the business financially. Similar to issues around cyber security. It’s not something that can be easily fixed, but there are processes and technologies that can be used to minimise risk and take a risk-based approach when managing customers.
How are some of your clients managing this?
Simo Buzanin: Many of our clients across APAC have already started implementing digital solutions to deal with identity theft and fraud. In many instances this forms part of their digital transformation strategy to ensure these risks are appropriately managed. We have been working with stakeholders across many teams including digital, risk and compliance, to assist in managing this transition while minimising impact on customer experience.
What’s best practice in the market for digital onboarding?
Peter Chan: This varies depending on the type of customer and how you engage with the customer during the onboarding process. At a minimum, businesses should have checks in place to verify the applicant’s identity. Businesses with digital onboarding should have additional precautionary solutions in place to link the individual to the claimed identity, such as biometrics.
We’re already verifying customers manually. How can illion further help?
Peter Chan: In a digital age, customers have become accustomed to a higher standard when applying for services both expecting high customer experience and quick response times. illion can further support with electronic solutions that are designed to automatically help verify individuals quickly and with minimal friction to the onboarding experience.
If you are concerned about fraud or identity crime within your business and would like to talk to an expert, please don’t hesitate to reach out to illion or ask a question here. Thank you and have a good day.
Want to learn more?
Fill in this form to talk to our friendly team today.
