June 26, 2023

The ID & Fraud Risk Score: Building Trust in a Digital World – Part 2

The ID & Fraud Risk Score: Building Trust in a Digital World – Part 2

In our increasingly digital world, the issue of trust has taken center stage. How do financial institutions and fintechs ensure that those they do business with are who they say they are? And how do they protect their businesses and their customers from fraudulent activities? The stakes are high. The answers to these questions can determine a company’s reputation, profitability, and survival.

Traditional methods of identity verification and fraud detection have often fallen short, as demonstrated by high-profile cases such as the Equifax data breach in 2017. The data breach, which exposed the personal information of nearly 147 million people, is a stark reminder of the shortcomings of relying solely on traditional, static data for identity verification and fraud prevention.


In part one of our series, we introduced 1datapipe’s concept of Living Identity Scores. Today, we’re excited to delve deeper into one of our three distinctive risk-scoring solutions: The ID & Fraud Risk Score.

Beyond Traditional Identity Verification


In a digital landscape where consumer behaviors are rapidly evolving, and cybercriminals are continuously innovating, a static view of identity is no longer sufficient. The ID & Fraud Risk Score, one of 1datapipe’s primary offerings, harnesses the power of artificial intelligence (AI) and machine learning (ML) to offer a dynamic, accurate, and real-time reflection of an individual’s identity.

In contrast to traditional methods, which often rely heavily on static data points such as credit reports, our ID & Fraud Risk Score provides an authentic and dynamic picture of an individual’s identity. This innovative approach encompasses over 370 attributes that are continuously updated, providing a complete 360-degree view of a client, and keeping pace with the individual’s changing circumstances.


The infamous case of the Wells Fargo account fraud scandal underscores the need for this dynamic approach. Between 2011 and 2015, thousands of fraudulent accounts were created without customer consent, highlighting a critical failure in identity verification and fraud detection. Had a system like the ID & Fraud Risk Score been in place, these fraudulent activities could potentially have been detected and prevented much earlier.

Next-Generation Fraud Prevention


At 1datapipe, we understand that businesses need to stay one step ahead of fraudsters. To this end, our ID & Fraud Risk Score goes beyond traditional fraud detection methods. Our process begins with attribute matching, incorporating a broader range of attributes from multiple data sources, surpassing standard KYC onboarding practices.


We then employ graph database analysis using state-of-the-art AI to uncover abnormal connections between profiles, ensuring a thorough assessment. This technique enables us to proactively mitigate risks associated with synthetic ID creation and account takeover, and identify individuals with a propensity for fraudulent activities.


Furthermore, our meticulous assessment of digital footprints, including web screening, phone, email, and IP risk checks, exposure verification, and behavior stability verification, provides a level of fraud detection and prevention that surpasses traditional fraud scores available in the market.

Building Trust, Safeguarding Businesses


1datapipe’s ID & Fraud Risk Score is about more than just data and algorithms; it’s about building a trustworthy financial ecosystem. Our comprehensive, data-driven approach enables businesses to confidently onboard new customers, secure in the knowledge that they have a thorough understanding of their identity and potential fraud risk.


This comprehensive strategy helps businesses avoid the potentially disastrous consequences of fraud, such as those faced by Danske Bank in 2018. One of Denmark’s largest financial institutions, Danske Bank, was embroiled in a massive money-laundering scandal involving suspicious transactions worth billions of euros. A robust and proactive system like the ID & Fraud Risk Score could have identified potential fraud risks early on, possibly averting such a catastrophe.


As we prepare to delve deeper into our next risk-scoring solution, the Credit & Behavior Risk Score, in part three of our series, we invite you to reflect on the potential impact of a robust and dynamic approach to identity verification and fraud detection.


At 1datapipe, we’re revolutionizing the way businesses perceive risk and handle identity verification. Our Living Identity Scores and associated risk-scoring solutions are tailored to drive financial inclusion and secure business growth. Let’s build a more inclusive and secure financial future together. Get in touch with us today to learn more.