As constituents seek government support for unemployment insurance benefits, healthcare, and pandemic relief programs, federal, state and local agencies’ remote services have been both overwhelmed and hindered by fraud. In an environment where constituent services are delivered online but identity is still paper-based, there’s a heightened need to protect your agency from fraud and abuse, while still providing strong performance and a positive user experience.
A new technology, document verification, can help agencies validate constituents’ identity and authenticate high-risk transactions such as unemployment or other government benefits. Document verification bridges the gap between paper-based identity systems, like social security cards and drivers’ licenses, and the online systems we use to deliver constituent services.
Pandemic crisis rapid response opens up agencies to fraudulent claims
Government agencies moved rapidly last Spring with COVID-19 relief packages for individuals and businesses. But with most agency offices shuttered during the early days of the pandemic, constituents turned to agency websites to submit claims for assistance.
Unfortunately, fraudsters were poised to ride the wave of increased online usage with fake or stolen identities to submit fraudulent claims. In addition, some agencies exposed relief to fraud by relying on outdated citizen data to distribute funds.
- Millions of payments totaling $1.4 billion in stimulus checks were sent to deceased individuals
- Unemployment Insurance fraud jumped as the number of claims sky rocketed in the spring. Washington State alone paid out more than $500 million in fraudulent claims
Increased fraud has led to the need for heightened vigilance. Cyber criminals targeted remote applications and identity processes through digital manipulation of identity documentation and leveraging compromised credentials across accounts, according to a recent FinCEN advisory.
What is the identity verification gap?
We find ourselves in a tough spot when it comes to identity verification. The U.S. has many nationally recognized authoritative identity systems trapped in the paper world. We have made progress in deploying self service web based applications but less progress with high assurance identity verification. Therefore, “Identity is being actively weaponized against us as the number one attack vector year after year in the form of data breaches.” - Jeremy Grant, Coordinator, Better Identity Coalition.
How do we close the identity verification gap?
Technical solutions that concealed the shortcomings of legacy verification solutions worked for a while but fraudsters have caught up. Knowledge based authentication (KBA), for example, used to work well but the combination of data breaches and social media, the fraudsters often have the keys to game these tools.
Today, advanced identity solutions can scan and validate ID documents with improved performance. So in this next phase of making identity better physical credentials such as drivers licenses and passports have to play a role.
Remote document verification links digital and physical credentials
Government agencies can employ remote document verification to achieve higher assurance identity. Remote document verification uses the unique features of a smartphone potentially in combination with a PC, along with an authoritative database of document templates to confirm the validity of the physical credential and (with consumer consent) also use facial recognition technologies to compare a “selfie” photograph with the photograph on the physical credential to provide an added layer of verification.
Best practices for this type of application will perform a number of validity checks including:
- Checking the document template
- Assessing the document for manipulation
- Comparing the identity attributes to an authoritative source of identities
- Assessing identity risks including synthetic identity fraud
- Comparing document to selfie, and
- Checking the device(s) in use to uncover risk
High assurance identity verification through document verification
Agencies should consider document verification in order to protect their constituents as well as meet their fiduciary duty to protect against fraud, waste and abuse. Some of the applications of document verification include:
- Account Registration – Initial user on-boarding
- Step-up Authentication – High-confidence method to immediately authenticate consumers who apply or enroll in faceless channels
- Manual Review – Authenticate consumers who may otherwise undergo manual review to reduce expense and abandonment
- On-Premise – Scan documents and receive real-time indicator of pass/fail of documents. Retrieve stored document to compare to customer for future in-person visits
Streamline identity verification using document verification
Federal, state and local government agencies could benefit from automating remote identity proofing using document verification, including:
- Reduce abandonment by managing user experience using physical credentials
- Reduce exposure to stolen and synthetic identities during account setup, claim submission or other high-risk transactions like new business filings
- Provide higher confidence in faceless transactions
Consider a complete identity verification solution
Document verification is just one aspect of a triangulated approach to verify identities. Government agencies have an opportunity to leverage technology and data to protect themselves from fraud and cybercrime while helping to streamline remote services.
This three-pronged approach connects devices, documents and identities in a unique way that offers maximum protection and opportunities for reduced user friction.