The timeliness of detection and diversity of data sources are critical factors in countering attempts to compromise consumer identities.
A study from ID Analytics shows that much like a stolen credit card, fraudsters exploit identities rapidly across multiple enterprises to monetize the identity before the consumer and businesses become aware of the compromise.
Attempts to use the compromised identity were observed to be up to 7.5 times higher than for non-compromised identities in a very short period of time, with most of the application velocity occurring within a 24-48 hour period.
Additionally, the compromised identities initially tend to appear at multiple businesses within the same industry, but over a longer period these identities are seen moving industries, likely in an attempt to defeat traditional fraud detection tools. Findings indicate that a compromised identity remains at increased risk, long after the initial fraud. Criminals will assert previously compromised identities at a rate 3.4 times higher than their non-compromised peers.
“Fraudsters strike fast and hard. Having access to up-to-the-minute transaction data from sources across industries is critical in detecting and preventing fraud activity,” said Scott Carter, CEO, ID Analytics. “Often, in-house solutions or vendor tools that rely on credit bureau or public records data will only detect the compromised identity after the confluence of fraud activity has occurred.”
Understanding fraud mobility, the pattern of how a fraudster uses an identity within and across industries, is one of the greatest challenges to fraud prevention and detection, the study found.