Real-Time Data: The Key to Preventing Identity Fraud
Only a real-time solution can stop shapeshifting fraudsters
Ah, Christmas. The most fraudulent time of the year.
Unlike bad actors, the uptick in online shopping and transactions (and fraud) — compounded by supply chain shortages — doesn’t imbue cybersecurity teams with much holiday cheer. But one simple, yet monumental change can make all the difference: joining the real-time data revolution.
Data is ubiquitous. Fraudsters are smarter and faster than ever. Real-time data analysis is the only plausible way for businesses to protect their finances and reputations. Out with static, or historic, data (email, phone number, SSN); in with dynamic, up-to-the-minute data (user activity, IP address, device). This is the way.
Companies employing a static, traditional fraud prevention approach are prime targets for account takeover (ATO) and new account creation fraud, among other cyber attacks expected to cost $10 trillion globally by 2025. Not switching to a real-time solution will inevitably lead to a breach sooner than later — and it only gets worse from there.
There’s no time like real time
The irrelevance of historic data in preventing fraud is easy to explain: much of that information is already available on the dark web.
In the seediest corners of the internet, large-scale cybercrime syndicates operate like a fraudulent bodega, peddling users’ personal info for discounted prices. Static data such as names, dates of birth, addresses, mother’s maiden names, and the like is low-hanging fruit for the modern fraudster: plug and play, ammunition for credential stuffing or creating a synthetic identity. Some of these groups are sophisticated enough to enlist AI and machine learning experts to orchestrate breaches, and cunning enough to cook up new schemes, like loyalty point fraud.
Hackers are also benefiting from gargantuan data sets. The data is coming in droves, from all directions, and companies unable to analyze, much less access, dynamic data won’t detect fraudulent activity until it’s too late. Time is of the essence, especially with fraudsters closing the gap between account creation and fraudulent purchases. Delayed fraud detection means delayed remediation, and more dollars down the drain. But dollar signs aren’t the only consideration for pivoting to a real-time fraud prevention platform.
Leave historic data in the past
If a company doesn’t leverage real-time identity data, and is consequently infiltrated by bad actors, most higher-ups will naturally obsess over the immediate financial consequences. However, dealing with chargebacks is peanuts compared to what awaits further downstream.
Think about customer churn, and the army of angry ex-customers who will air their grievances across social media. The combined lifetime value of those lost customers plus the negative hit to brand reputation is not an endearing combination — and even the most seasoned crisis comms team may not fully right the ship.
Then, of course, are the fine-happy regulators who won’t be too thrilled to see another Equifax or Robinhood fiasco. Neither will investors, who are increasingly prioritizing businesses with air-tight threat intelligence. If a company, and its customers, are at risk, so is its valuation.
Adopting a solution that can harness real-time, dynamic data is the key to effectively preventing ATO and new account creation fraud. It provides the necessary adaptability to keep up with shapeshifting fraudsters and stop attacks before they happen — the only acceptable speed in today’s world.
Deduce’s real-time Identity Network, comprising more than 400 million anonymized user profiles collected from 150,000 websites, preemptively alerts companies of fraud well in advance. Want to see how Deduce’s real-time solution can shore up your fraud protection? Contact us today.
