Identity Thieves Online
Identity theft and fraud cost consumers and businesses nearly $53 billion in 2004, according to a report commissioned by the Better Business Bureau. The average victim of identity theft spends about 28 hours resolving the damage the crime inflicted on their credit, the study shows.
The good news is statistics also show that conducting transactions online is actually one of the safest ways to do business. Companies employ a range of high-tech defenses to protect customers’ personal information, and most identity theft still occurs in the traditional ways – a stolen wallet or credit card statement pilfered from the trash.
While many people are familiar with online protections like firewalls and anti-virus software, savvy consumers are choosing to give their e-business to companies that also use real-time data verification to block identity theft and fraud.
“Real-time data verification and authentication protects both the consumer and the business,” says John Andrews, director of technical services for DataX Corp, a Las Vegas-based data services company. “The technology compares an online consumer’s information to literally millions of public and private records to instantly verify the individual’s identity.”
For both the consumer and the company, the process appears simple and seamless. A customer arrives at a company’s Web site, to purchase a product or, more commonly, a financial service, and is prompted to provide basic information, such as name, address, telephone number and e-mail address.
The first layer of defense, data verification, compares that information to public records to confirm that the data is accurate - that a phone number entered is a real number or the mailing address actually exists. Verifying this initial data before it becomes integrated into the company’s records can save a business the cost of cleaning out “garbage data” later on, Andrews notes.
Next, the process verifies that the personal information entered, such as a driver’s license or social security number, represents a real person. “For example, DataX Corp’s system will check a social security number against the Social Security Administration’s list of active numbers to confirm that the number entered doesn’t belong to someone who is deceased,” Andrews says.
Finally, the information is authenticated by prompting the user to enter additional information that is verified through comparison to millions of additional records, such as credit bureau information and other public records. This last step helps ensure that the individual providing the information is really who he or she claims to be.
From online retailers to financial institutions, companies that once struggled to perform their own data verification by connecting to individual data sources are now turning to services like DataX Corp to manage real-time
data verification for them. “This route allows a company to access the most current sources of information for verifying identity, without the costs and difficulties of managing relationships with all these data resources on their own,” says Derek LaFavor, CEO of DataX. “It’s good business sense on two very fundamental levels: protecting your customers from identity theft, and protecting the company from costly fraudulent, and just wrong, information.”
The end result is a fast, cost-effective means of confirming identifying information. To learn more about how real-time data verification protects consumers and helps businesses, visit
Courtesy of ARA Content
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