Today, businesses are increasingly transitioning to digital operations, a trend that has been accelerated by the pandemic. This shift has led to the adoption of digital onboarding procedures instead of traditional face-to-face methods. Unfortunately, this has also resulted in a significant increase in New Account Fraud as fraudsters have adapted to the changing landscape. Onboarding security issues are a concern across various industries, including financial services, e-commerce, and public administration. Therefore, it is essential to allow digitized access to services while also being able to identify and prevent fake or fraudulent users.
New Account Fraud, also known as Account Opening Fraud or Onboarding fraud is a type of identity theft where fraudsters use stolen or fabricated identities to open accounts in someone else’s name. This can include bank accounts, credit cards, loans, or other financial products. The goal of New Account Fraud is typically to obtain credit or make purchases using the stolen identity, leaving the victim with the bills and potential long-term financial damage. It can also led to money mules activities. However, it’s not only a financial-related threat, fraudsters also target public administrations to hijack tax refunds, pension funds, or e-commerce loyalty programs.
New Account Fraud is the gateway to other attacks, such as:
New account fraud typically follows the steps below:
Digital onboarding procedures often prioritize gaining new users over security during solution development, leading to a preference for a smooth user experience. However, balancing this with identity checks is essential to prevent the negative impact of fraud. New Account Fraud presents new challenges and demands innovative detection and protection approaches. A holistic approach that considers user information, biometric behavior, and device fingerprints is necessary for protecting the Account Opening procedure within digital services. Also, financial institutions should converge traditional fraud monitoring with AML instruments to enhance security.
The XTN New Account Fraud Protection solution utilizes behavioral insights to safeguard your business against New Account Fraud. This approach integrates behavioral biometrics and behavioral analysis as crucial tools in the fight against onboarding fraud. By analyzing user behavior in real-time during the account opening process, XTN’s solution can identify and detect fraudulent activity that may have gone unnoticed with traditional identity verification methods. This provides an additional layer of security to protect against new account fraud.
We specifically spot any fraudulent attempts such as:
Keep digital business safe from New Account Fraud with XTN Cognitive Security®:
Consequences of New Account Fraud can impact a digital business by:
• Outstanding debts
• Customer acquisition campaigns damaged
• Compliance and reputational issues
Have any question? We’d love to hear from you.