CNP Expo: The Real Deal – The Challenge of Validating Identities in a New Reality
May 19, 2015
Tom Donlea, director of the e-commerce practice at Whitepages Pro, kicked off a late-afternoon discussion on validating and verifying identity by asking how identity verification relates to the coming EMV implementation. Amador Testa, chief product officer at Emailage, observed that due to the recent data breaches, “there are a lot of credit card numbers and identifying data floating around out there. With all this data available, and fraudsters not being able to use it at the POS, it creates the conditions for a perfect storm of CNP fraud.”
The panel’s identity discussion also touched on friendly fraud, where someone close to the cardholder uses the card and the cardholder disputes the charge—either out of ignorance or maliciously. Aaron Press, director of e-commerce and payments for LexisNexis, noted it’s nearly impossible to determine up front that the purchaser is not the cardholder when the purchaser has access to so much identifying personal information. He said, “One thing we’ve been exploring [at LexisNexis] is that a lot of fraudsters don’t specialize—a tax fraudster is likely to commit card fraud, etc., so even though it doesn’t create necessarily a strict blacklist, it can give some indicators to help sort out a case of friendly fraud.”
Michael Hagen, CEO of IDchecker, predicted biometrics would solve the problem of friendly fraud going forward. Press agreed, but pointed out that the enrollment process is the major challenge to biometrics—if someone else registers your fingerprint, what then? He believes we need more multi-factor identification to get around that issue.
“We keep thinking the next big thing will be the solution,” Press said, “but it often just changes the problem, and unfortunately fraudsters often find those holes before we do.”