Fact vs. Fiction in Identity Verification and Fraud Prevention

When it comes to digital identity verification and fraud prevention, accurate information about the success of different solutions can be hard to find. Particularly in the public sector, agency leaders are presented with mixed messages on auto approval ratings, fraud capture, and user experience. For those not immersed in the industry, it is sometimes hard to know what success looks like in this environment.

Let’s cut through the noise and separate fact from fiction when it comes to effective, efficient, and frictionless digital ID verification and fraud prevention.

What Does Success Look Like? 

To be blunt, if you are in the identity verification business, then your mission should be to verify 100 percent of good identities in real-time. 

As the digital identity verification market matures toward that goal, it is critical for commercial and public sector decision makers  to be armed with accurate information on existing capabilities.  And as the Government Accountability Office noted last week, sound programs have yet to be designed in major programs to ensure massive fraud experienced during the pandemic cannot be repeated.

Unfortunately, certain parts of the marketplace would have agencies  believe that a 50-80 percent auto-approval rate for good identities is a measure of success. 

But this falls far short of what’s possible , putting additional strain on scarce government resources, leaving good consumers without the benefits they are due, and failing to identify much of the real fraud that exists today.

By contrast, industry leaders like Socure are already achieving 90+ percent auto-approval rates for applicants while capturing the vast majority of fraud. 

Using the latest in AI, machine learning, and predictive analytics, government agencies can achieve more and strike a better balance between approving good users seamlessly and detecting fraud. 

Lower Auto-Approval Rates Do Not = More Fraud Detection

 A common tactic used to obscure what is possible is to conflate poor performance in approving good identities with a higher rate of fraud detection. 

The two are completely separate issues. 

Solutions built on legacy approaches like credit-based identity verification detect less fraud, not more. At the same time, they exclude unbanked, underbanked, new-to-country, and marginalized populations leading to extensive false and inaccurate identifications.

State and federal agencies need digital identity verification that provides more inclusive and equitable coverage informed by a broader and more effective set of data sources. 

Meanwhile, those good consumers applying for government benefits deserve to have a simple, effective process that speeds the delivery of their benefits as fast as possible.  

More Friction Does Not Lead to Less Fraud

Today, some identity vendors treat far too many good consumers like fraudsters and scam artists. The result is an incredibly challenging user experience with little to no impact on actual fraud.  Understandably frustrated users abandon the process and don’t get the services and benefits they are due.

With Socure’s cutting-edge solutions, the process is virtually frictionless for the vast majority of people who can be auto-approved using our data-science-based approach. Additional security measures are put in place for a small percentage of applicants who require additional reviews.   

Additionally, Socure offerings seamlessly integrate with state and federal agency applications so end users do not need to visit a third-party website or sign up for a third-party account.

Using Socure, public sector agencies don’t have to choose between identifying fraud or providing a great user experience. As Congress and state legislatures reconvene to examine both how to assess previous fraud losses and build more robust solutions for the future, oversight bodies should require agencies that use external identity proofing providers to publish statistics on effectiveness to drive further maturation in the market.

Bottom line:  Socure provides our public sector customers with innovative, market leading  technology capabilities that enable higher approval rates, capture more fraud, and provide a better user experience.  It’s high time we demand all providers document performance and increase transparency so policymakers and citizens can understand what’s happening to stop fraud and increase efficiency in vital government programs.