Ecommerce, banking, airport and social media platforms need to verify the identity of their customers to prevent risks and comply with financial regulatory laws. Fulfilling these compliance requirements is not an easy task due to a lack of adequate resources that negatively affect the customers’ experience.
Therefore, document verification services are necessary as it helps in achieving the regulatory compliance and ensuring frictionless user experience.
Why Identity Document Verification Is Important?
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False impersonation is a crime as fraudsters use stolen identities to gain benefits and cause harm to the account of verified customers. There are various ways by which cyberattackers carry out impersonation attempts. They use the stolen credentials of others to spread hate, harass and bully social media users.
The local and federal law strictly prohibits impersonating someone by using any individual’s identity and is punishable according to the law. In 1998, congress enacted legislation for Identity Thefts and the Assumption Deterrence Act.
This law defined impersonation and identity theft as the new offense that forbids “ intended transferring or using without lawful authority, the use of the identity of other people to commit or support any illegal activity that is considered as the violation of federal and local law”.
Cases of identity thefts are growing rapidly. The Federal Trade Commission (FTC) statistics show that 1.4 Million cases of ID scams were reported in 2020, and in the majority of them, people had lost their money.
How Digital Document Verification Prevents Fraud?
To prevent evolving threats of ID fraud, financial regulatory bodies such as FATF, FinMA, and FINTRAC introduced KYC and AML laws for businesses to adhere to. These rules facilitate businesses to carry out proper due diligence and identity verification procedures for their customers.
It is achieved by the proper inspection of customer ID documents to authenticate their identity and eliminate the possibility of fraud. The Know Your Customer (KYC) measures required customers to visit financial institutes for their verification of identity.
However, thanks to technological transformation, the process can be performed flawlessly with the assistance of AI-driven document verification systems. Customers can easily verify themselves by uploading a live selfie and photo of their ID documents from their smartphones or laptops. If you are after the great quality of the photo that guarantees the privacy and protection of your image from being used in scamming schemes, get it at Photo Studio Calgary.
How Online Document Verification Is Performed?
The artificial intelligence-based software is integrated into the online business portals. Whenever the clients perform registration on the platform, the software asks the user to capture and upload the image of their identity documents in real-time. The software scans and reads the relevant information from the document with the aid of Optical Character Recognition (OCR) technology.
The system checks the authenticity of data by performing various document checks. After a complete analysis of data by the software, the results are delivered to the customer in real-time and the client is authorized to use the platform.
The verification is only carried out through government-issued ID documents that consist of photo-based identity cards, passports, and driving licenses. The system detects modified and fake documents instantly and prevents illegal access. Following are the types of counterfeit documents that fraudsters commonly use are:
Illegitimate ID Documents
These documents consist of fake information. They lack certain properties such as missing micro prints or holograms, fonts, watermarks, and other features that are the major component of the authentic document.
False Documents
These documents belong to other individuals that are stolen by fraudsters. They use them for verifying themselves as legitimate customers and acquire the services in his name.
Modified Documents
These are genuine documents but they are modified. The scammer changes the writing style and fonts of the document to deceive the system.
Why Is Document Verification Solution An Effective Approach?
Document validation services can verify whether the document is counterfeit, false, or completely fake. Digital document verification is more accurate than manual document verification procedures. It reduces the cost and time while providing a more streamlined customer experience to users.
Clients can easily verify themselves remotely without the need for visiting financial institutes for verification. The document verification system can identify documents of multiple types and formats that vary from country to country. It helps in authenticating documents of foreign clients from around the world.
Conclusion
Online document verification services are essential for banks, e-commerce, airports, and financial industries to prevent fraud with AI-driven ID verification systems. It facilitates businesses to verify their customers and helps them to fulfill the regulatory requirements of financial legislative authorities.
