Today at the ABA/Foreward Financial Bank Technology Convention, Digital Envoy, the leading provider of IP Intelligence solutions, introduced two modules to its IP Inspector Fraud Analyst product, which provides a second factor of authentication beyond traditional user names and passwords.
According to the Federal Trade Commission (FTC), 9.9 million Americans were identity theft victims last year. Of those, 6.6 million reported fraudulent use of existing accounts while more than 3 million reported new accounts opened in their names. These criminal activities cost consumers $5 billion and businesses $48 billion in financial losses.
"Increasing concerns over stolen identities are driving banks to review their account-access procedures and examine new, more sophisticated technology for real-time fraud prevention," said Bill Calpin, president and CEO, Digital Envoy. "We believe multi-factor authentication will become mandatory for safely and efficiently executing business online. The Federal Deposit Insurance Corporation (FDIC) is currently formulating recommendations that encourage financial institutions to abandon single password-ID systems in favor of multi-factor authentication. However, the real challenges with this type of risk-based authentication – and ones that Digital Envoy has successfully addressed - involve making it seamless for the financial services organization yet transparent to the online customer."
Transparent, Multi-Factor Authentication
Unlike other multi-factor authentication solutions currently available, Fraud Analyst does not rely on privacy-invasive computer monitoring techniques or expensive and cumbersome handheld alternatives such as SMS messaging, token-based systems or smart cards. Using an online customer's unique identifier – an IP address – Fraud Analyst non-invasively uncovers more than a dozen data elements including location, anonymous proxies, domain name and other identifiable attributes referred to as "IP Intelligence". It then automatically analyzes this information against multiple data sources and profiles to prevent online fraud in real time.
Introduced last summer, Fraud Analyst was the first identity verification solution developed specifically for the financial services industry to prevent online banking fraud in real time. Fraud Analyst now comes pre-configured with these two new modules:
- Login Authentication Module averts account hijackings by creating behavioral online customer access profiles that help verify user identity for every transaction. It is non-invasive, simple to deploy and requires no hardware, software or cookies on customers' PCs.
- Account Opening Module prevents fraudulent new account openings by automating, expediting and securing the online account opening process. It prevents application fraud in real time by utilizing a customizable, rules-based engine to analyze customer-supplied information against IP information to provide strong identity verification.
"With these two modules, Digital Envoy offers a cost-effective and reliable approach to multi-factor authentication," said Calpin. "Financial institutions can now prevent online fraud losses while automating the authentication process – throughout the entire customer lifecycle – whether validating new accounts, preventing account hijackings or adding a new layer of security to online transactions."