New Account Fraud Detection

The Internet’s anonymity allows criminals to open accounts with a wide variety of businesses online. iGaming, dating and e-commerce platforms are the most common targets but banks also suffer from new account fraud attacks that can have severe financial consequences for them and their customers.

Criminals commit New Account Fraud Detection by using stolen identities to create fake profiles. They then use these profiles to open digital accounts, transfer funds, and make withdrawals. They are aware that banks check accounts often to satisfy KYC compliance protocols and they rely on that scrutiny to their advantage.

Understanding New Account Fraud Detection: Safeguarding Against Financial Loss

One of the key signs of a potential fraudulent new account is a discrepancy between an applicant’s residential address and the address on their ID document. Another is when an application contains a PO box or mail drop address instead of a real residential address. Also, when the account holder is over 25 with an established social security number and changes addresses within six months it should raise suspicions.

Cybercriminals have a lot of experience with fraudulent new account creation and they know how to hide their tracks. But even for seasoned professionals there are small clues that can give them away. The way someone uses a device, their keyboard shortcuts and patterns, how quickly they fill in forms can all be tipped off to fraud by the right analytics tools. Also, it’s important to consider the timing of deposits made close to bank holidays. That’s because criminals try to execute their withdrawals before the deposited checks are returned by the banks.

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