The internet is a curious place — a digital bazaar where anything can be had, for a price.
Online storefronts promise all manner of goods and services. Dig a bit into the dark web, as Bloomberg noted on Wednesday (April 6) and it’s possible to get all manner of doctored financial documents — and ones made up out of whole cloth.
In this case, those ersatz offerings — fake tax returns, utility bills, bank statements, you name it — can be bought from a site called banknovelties.com.
Those fake documents are wielded by fraudsters who seek, and have sought, to game the system — recently siphoning off billions of dollars from pandemic-era relief that had been mandated as part of the Coronavirus Aid Relief and Economic Security Act (CARES Act).
One item of note: Banknovelties, as the newswire reported, accepts payments only in bitcoin for the fraudulent wares. Bitcoin, of course, has been used by fraudsters in all manner of schemes, due in part to its relative anonymity.
The mere existence of banknovelties.com shines a light on a pressing problem: It’s hard for businesses to verify other businesses; it’s hard for government agencies to verify legitimate firms (not to mention individuals) with which they are interacting, especially when applications for aid are time-sensitive and urgent.
Advanced technologies, after all, can help create authentic looking documents from lenders and institutions that in turn are used to defraud other lenders and institutions.
The best lines of defense, then, may be tied to leveraging advanced technologies that help firms prove they are legitimate, in tandem with the documentation and data that are offered at the points of onboarding.
As Brandon Spear, CEO of TreviPay, told Karen Webster in a recent interview, application fraud is a bit like identity theft, especially in a B2B setting.
As noted here in recent weeks, roughly 19% of merchants deploy several methods as they vet and onboard new business partners, which implies that at least some buyer/supplier relationships are embracing new layers of protection.
Read also: 19% of Merchants Rely on Multiple Verification Methods to Vet New Business Partners
Joint research between PYMNTS and TreviPay shows that, given the choice of 12 partner verification methods, 150 executives said “all” of them were, and are, important. Methods included checking employer verification numbers, and embracing third-party providers that use automated know your customer (KYC) and anti-money laundering (AML) compliance efforts to verify business and credit information. That 19% number, of course, leaves significant room for new, and robust, tech-driven verification methodologies to be embraced.
As for the urgency in doing so, the same research found that 16% of the executives surveyed said verifying the identity of new customers is the most important challenge to their operations, while another 33% said it is an important, but not the most important, challenge.
Near-term tech investment goals show that executives are moving to meet the challenge amid the threat of application fraud: 71% of organizations surveyed have said that they plan to implement new digital solutions to prevent fraud.
Read also: As Application Fraudsters Set Sights on B2Bs, A Growing Threat Looms
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More