The combination of personal and digital identities sets the

CHICAGO, Oct. 08, 2019 (GLOBE NEWSWIRE) — In the fight against synthetic impersonators, the pendulum may finally swing towards lenders. Instances of synthetic fraud and outstanding balances for suspect synthetic accounts have slowed or declined for most of the past year in auto, credit card, retail credit card, and personal loans.

The slowdown in growth comes as TransUnion (NYSE:TRU) and iovation, a TransUnion company, have combined their fraud prevention offerings over IDVision® with iovation®. The suite of solutions brings together both personal and digital identities to detect threats across markets while ensuring a seamless user experience. IDVision with iovation combines traditional data science with artificial intelligence and machine learning to provide insights to businesses at every consumer touchpoint.

“In the 15 months since TransUnion acquired iovation, we have made great strides in protecting businesses and consumers,” said Geoff Miller, head of global fraud and identity solutions at TransUnion. “Synthetic fraud has increased in each of the last five years, but we are seeing growth slowing down due to the deployment of anti-fraud solutions like IDVision with iovation in the financial industry.”

In synthetic identity fraud, scammers create fictitious identities by piecing together real identity attributes and fake information to open fraudulent accounts. Total synthetic fraud balances increased marginally from $1.01 billion in Q2 2018 to $1.02 billion in Q2 2019, according to an analysis of TransUnion data. This type of fraud has increased significantly in recent years slowed after rising to $854.4 million in Q2 2016 from $524.5 million in Q2 2015.

Growth in outstanding balances for suspected synthetic accounts is slowing

credit category Q2 2019 Q2 2018 Q2 2017
car loans $630.5 million $621.9 million $590.7 million
credit cards $277.5 million $281.9 million $289.1 million
Retail credit cards $76.0 million $72.7 million $66.4 million
Unsecured Personal Loans $33.6 million $32.7 million $24.4 million
total $1.02 billion $1.01 billion $0.97 billion

In addition, cases of synthetic fraud have decreased significantly for most credit products. The number of new car loans associated with a synthetic fraudster decreased to 0.16% in the second quarter of 2019, compared to 0.22% in the second quarter of 2018. Retail card incidents also decreased from 0 during the same period .14% to 0.12%.

Synthetic fraud cases mostly down

credit category Q2 2019 Q2 2018 Q2 2017
car loans 0.16% 0.22% 0.22%
credit cards 0.26% 0.24% 0.28%
Retail credit cards 0.12% 0.14% 0.15%
Unsecured Personal Loans 0.08% 0.08% 0.07%

“The device is pivotal in combating synthetic fraud by determining whether it has previously been associated with a synthetic identity and used to open an unusually high number of accounts in a short period of time,” said Greg Pierson, CEO of iovation. “Using personal and digital identities is a unique approach to combating fraud, and we believe continued and increased use of these solution sets will help identify more fraudsters while protecting revenue.”

As online transactions go mobile, so does fraud

Leveraging digital and personal intelligence to combat fraud is especially important today as mobile becomes the platform of choice for consumers – and fraudsters alike. According to data from iovation, mobile devices accounted for 51% of global online financial services transactions in 2018, compared to 49% for desktops. This was the first time mobile was in the majority and nearly doubled from 2014 when it accounted for 28% of transactions.
At the same time, the worldwide suspicion of fraud through mobile devices in the financial services sector has increased. In fact, the percentage of transactions declined due to fraudulent behavior increased to 41% for iovation’s financial services clients in 2018, compared to 21% in 2017.

The type of device used is also an indicator of fraud. From July 2018 to June 2019, iovation found that Windows and Android devices had the highest percentage of suspected fraudulent transactions from US financial services firms, at 0.54% and 0.50%, respectively. This was followed by iOS (0.27%) and Mac (0.26%) devices.

“Fraudsters often build their identities and credit profiles on specific devices that can be connected to each other. Identifying these fraudsters with the device early in the system, before a credit history is built up, is critical to preventing identity dissemination and losses that ultimately result from fraudulent loans and purchases,” Pierson added.

Declare war on scammers

Using mobile devices for synthetic fraud purposes is just one of many other forms of fraud affecting financial services, insurance, and the public sector, among others. However, it is also one of the most difficult techniques to protect since enterprising scammers have used technologies such as mobile emulators to their advantage.

Forming IDVision with iovation aims to change the playing field. IDVision with iovation offers a combined platform leveraging one billion consumer datasets and insights from experience across over six billion devices.

“The insights and analytics gleaned from our vast device and personal data are critical for organizations fighting fraud,” concluded Miller.

Further information on IDVision with iovation is available here click here.

About TransUnion (NYSE:TRU)
Information is a powerful thing. At TransUnion, we know that. We strive to find innovative ways in which information can be used to help individuals make better, smarter decisions. We help uncover unique stories, trends and insights behind each data point using historical information as well as alternative data sources. This enables a wide range of markets and companies to better manage risk and consumers to better manage their creditworthiness, personal data and identity. Today, TransUnion has a leading presence in more than 30 countries worldwide and in several international markets in North America, Africa, Europe, Latin America and Asia. Through the power of information, TransUnion works to build stronger economies and families and safer communities around the world.

We call that information for good

About iovation
iovation, a TransUnion company, was founded with a simple mission: to make the Internet a safer place for people to do business. Since 2004, the company has met this goal by helping brands protect and retain their customers and keep them safe in the complex digital world. Powered by the world’s largest and most accurate database of reputation insights and cryptographically secure multi-factor authentication methods, iovation protects tens of millions of digital transactions every day.

Contact David Blumberg
E-mail [email protected]
phone 312-972-6646

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