BioCatch is once again warning about the dangers of account opening fraud, and highlighting some of the countermeasures that financial institutions can use to prevent it. In that regard, the company notes that 85 percent of financial institutions have experienced some form of new account fraud, which is expected to lead to $3.1 billion in 2021 losses in the US alone.
However, BioCatch argues that behavioral biometrics can help mitigate that damage. Dealing with new account fraud can be difficult because a financial institution does not yet have a track record with a new user. Thankfully, fraudsters and legitimate customers tend to have different behavioral patterns when signing up for a new account. Those differences can be used to distinguish one from the other, even in cases where there is no established history.
Most notably, BioCatch found that 64 percent of the time, people committing new account fraud were not as familiar with the personal data they were using to open the account, and took more time to enter that information than other users. That can most likely be attributed to the fact that legitimate customers have usually memorized details like their address and phone number, and therefore do not need to reference a second source while filling in a form. The opposite is true for fraudsters, who may need to look up personal details but will often be well versed with the ins and outs of the account opening process itself.
BioCatch has repeatedly noted that fraud rates have gone up as digital traffic has increased during the COVID-19 pandemic. That remains true for multiple forms of fraud, and corresponds with a rise in social engineering attacks and mule accounts in addition to new account fraud.
BioCatch currently has more than 150 million behavioral biometric profiles in its system, and analyzes more than 1 trillion transactions and 2 billion sessions on a monthly basis.
October 26, 2020 – by Eric Weiss