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How to Recognize Fake Documents and Secure Your Business

With the spike in identity theft and fraud, how can you recognize forged documents and save your business?

Business transactions are now completed without face-to-face interaction between the seller and buyer - thanks to the internet. But the spike in identity theft and fraud has pushed business owners to seek methods of securing customers’ transactions and boosting the safety of their platform as well. Carrying out identity verification of users is one of such methods, but this has not deterred fraudulent people from using fake documents for the verification process.

Age-restricted product purchases, financial transactions, and online gaming or betting require verifiable documents like driver’s license, passport or national ID card as proof of identity. Individuals who cannot afford these services or do not want a digital print of their activities tend to impersonate, duplicate or use another person’s documents in carrying out transactions. But what kind of documents are commonly forged and how can one spot them?

Most Common Fake Documents Used for Verification

A forged ID done in the right format can appear original, and an original ID can also be altered then sold to a look-alike. In the wrong hands, forged documents can be used for data breaches, bank fraud, theft of digital assets, immigration fraud, and social security fraud. Here are some of the most common fake documents used:

International Passport

Though often forged by those seeking to commit immigration fraud, it’s sometimes used by cybercriminals as proof of identity. Eyes often go to the expiry date and photo, making it easy for criminals to exploit other loopholes like edited passport number and fake hologram unnoticed.

Driver’s license

The driver’s license remains the most commonly used. Its widespread use in countries like Germany, America, and the UK results in a lucrative black market for dealers of fake IDs.

National IDs

The availability of fake photo ID and fake ID number generators online has led to an increase in the rate of fraudulent activities using national ID cards. According to the Social Security Administration of the United States, counterfeiters find loopholes in the security features, and state-of-the-art technology makes it easy to alter.

Impact of Fake Documents on Businesses

Businesses take the responsibility of verifying the authenticity of every transaction. ID authenticity creates value for businesses, which makes mitigating the risks involved in virtual transactions crucial. Compliance with regulatory requirements is another reason why efficient strategies for identifying a forged ID are necessary. But with these forgeries becoming more sophisticated each year, their impact on society and the economy are now profound.

A single use of a forged ID has a ripple effect from business to the economy of a nation. Consider businesses selling age-restricted products or services like cigarettes, alcohol and betting for example. They can have their licenses suspended or revoked, and employees could lose their jobs. Compliance checks have led to a series of license suspensions in the UK, according to a BBC report.

Many businesses are looking at profits and churn rates to keep up with competitors, and hardly at identity theft. That’s why accounts opened or transactions made with fake IDs are not quickly detected. In the long run, this can result in fraud and damage to the reputation of the business.

When fraud is committed with fake documents, a business loses customers’ trust, leading to a significant dip in the company’s share prices, sales, conversion rate and an increase in security costs. In some cases, it could mean jail time for executives or employees involved if negligence was the reason behind the breach using forged documents. Stiffer sanctions for offenses related to fake documents can reduce its widespread use.

How to Recognize Fake Documents

Deep fake technology allows for the easy production of a fake photo ID with a fake ID number. Some of these forged documents have most of the anti-forgery features on original copies provided by the issuing authority. Sophistication in document verification technology has also led fraudsters to improve their methods, making spotting a fake ID more challenging. But how can business owners, product managers, compliance officers and developers identify fake documents?

Automated data extraction

Artificial intelligence and machine learning has made data extraction easier, allowing insights to be drawn from unstructured documents in different formats. Having a system that assesses a new user’s profile based on submitted ID documents to ensure that vital information does not match any critical data of pre-existing users in a secure database is recommended for online businesses. Graphic errors like misspellings, wrong placement of photos, and signature disparity should be seen as red flags. Scannable features like barcodes can tell the difference between fake documents and an authentic one, since some of them are not produced using standardized encoders.

Taking verification selfie with ID

Some organizations have implemented a technique of asking for a selfie taken directly from the identification platform in real time. Others require a selfie video with the user holding the uploaded identity document. Comparing the facial biometrics from the selfie with the image on the photo ID can help identify an impostor.

Manual document checks

Documents from certain countries or individuals undergo extra checks - most times manually. Business owners want an effective way to cope with the unintended consequences that automation brings. Even when cameras and sensors can look at a user and compare data, sometimes it’s important to look at the document manually to ascertain that there are no alterations. The more forged documents there are, the more sophisticated strategies. An automated system with biometric verification is programmed to extract certain data, but manually, other details can be uncovered. An efficient solution combining both methods for authentication.

The Future of ID Verification and the Fight Against Fake Documents

Any identity document submitted as a 2D image could be a fake photo ID with a fake ID number. Only a few indicators are visible in this format, hence you can ask for additional supporting documents like tax number, selfie videos and proof of address

The prevalence of online services optimized for mobile platforms has made authentication using digital identity credentials a viable option. But it is not the remedy to the widespread use of fake documents, as there are still several people that do not own internet-enabled mobile devices. When identities of such people are stolen, it’s difficult for them to find out. On the other hand, cloning of mobile devices has also increased the risk of identity fraud as mobile IDs can be stolen and used as a means of identification.

Biometrics which involve the use of physical features like fingerprints and DNA that are unique to every individual make the use of forged documents difficult. It is the future for businesses that offer self-service channels. Criminals believe that they can discover and exploit the loopholes in any system, but this could serve as an option for lots of businesses.

Conclusion

Forged documents with a fake ID number could mean a victim’s account getting taken over by the criminal. This impersonation scam could have financial consequences when the stolen identity is used to take loans from banks, withdraw money or digital assets and carry out other forms of fraud online. It is why online products and services need advanced systems that can detect signs of graphic editing and incidents of data reuse.

Partnership with verification service providers like Passbase grants access to identification tools that can improve security and the overall online authentication experience on any platform. With integration on Android, iOS, or the web, Passbase combines biometric authentication, machine learning, and language-specific micro-services. These technologies help mitigate risks that come with data exchange in the digital sphere.

ID authenticity scores for all IDs, including forged documents are also made available. The identity auditor allows businesses to assess the risks of every transaction… Routine re-authentication is also carried out to maintain the integrity of the business and mitigate the risk of identity theft.

Passbase provides a convenient way for businesses to perform KYC and AML checks through identity verification. You can integrate Passbase into your platform via the Passbase API or with SDKs for iOS, Android, and web.

To see how identity verification can work for your business today, try Passbase today for free or book a demo.

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Passbase is an identity verification solution that makes facial recognition, liveness detection, ID verification and KYC and AML compliance accessible through a suite of flexible developer tools. A zero-knowledge architecture ensures that companies using Passbase can securely verify users from over 190 countries without having to store their data. Built for developers, it can be integrated with just a few lines of code on iOS, Android, and Web.