02:07 PM
Connect Directly

Outfoxing I.D. Thieves

Startup aims to stop fraud before it starts

Identity theft and associated fraud is costly to financial organizations as well as consumers. Market-research firm Financial Insights says such theft will cost financial institutions $4.2 billion this year and likely reach $8 billion by 2006. Startup ID Analytics Inc. says it has found a way to thwart thieves at their point of entry: the credit application.

chartID Analytics has studied more than 200 million credit applications from credit-card issuers, banks, and other sources, 10 million of which are suspected or known to be fraudulent. Using that data, the company has developed pattern-recognition technology that looks for dozens of fraudulent patterns in an application. "We can see trends no company would be able to see looking [only] at their own data," says CEO Bruce Hansen. A bank approving a checking account may not know that a thief used the same Social Security number to start three retail charge cards and establish a new residence just prior to applying for the account.

Applications from customers such as Citibank and Diners' Club get vetted against the vendor's database and given a score that ranks the likelihood that it's fraudulent. "I can say it works," says an executive at a large financial-services company, "and it's working better than our initial expectations."

Comment  | 
Print  | 
More Insights
The Business of Going Digital
The Business of Going Digital
Digital business isn't about changing code; it's about changing what legacy sales, distribution, customer service, and product groups do in the new digital age. It's about bringing big data analytics, mobile, social, marketing automation, cloud computing, and the app economy together to launch new products and services. We're seeing new titles in this digital revolution, new responsibilities, new business models, and major shifts in technology spending.
Register for InformationWeek Newsletters
White Papers
Current Issue
InformationWeek Tech Digest - August 20, 2014
CIOs need people who know the ins and outs of cloud software stacks and security, and, most of all, can break through cultural resistance.
Flash Poll
Twitter Feed
InformationWeek Radio
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.