Fraudsters and scam artists are always trying to come up with new ways to game the system, so you – the business owners – must do everything in your power to make their job harder. Identity verification is one of the tools that can stop them in their tracks before they get to have their way with you. For a better understanding of this, we’re going to list a couple of scenarios where it can help:
Kids or teenagers trying to fake their age
Teenagers and kids will often try to misrepresent how old they really are so they can purchase adult-only products like cigarettes and alcohol. Admittedly, this group of people is probably the most innocent among all of those who are trying to present some form of falsified IDs, but when it comes to respecting the rules, there can be no exceptions. Taking advantage of an identity verification service at Jumio’s Netverify or a similar one will prevent them from fooling you (so you won’t be subjected to any form of liability associated with selling alcohol to minors).
Sometimes, if your competition is fueled by ill intentions, they will place several fraudulent orders with no intentions of ever collecting the packages you send them. Immediately, this creates a whole set of problems: while your packages will probably be returned to you by the post office, you’re still going to have to pay for the postage fees. Moreover, while the packages are waiting at the post office for someone to pick them up, these products will be temporarily out of stock, which could cost you some legitimate orders from legitimate customers.
Hackers trying to use stolen credit cards
Too many times, a hacker obtains access to credit card data belonging to someone else, then tries to make illegitimate purchases and slowly drain any funds the card holder may possess. Identity verification software can immediately detect when the buyer’s physical address doesn’t match the one that person has ordered the goods to (in this case, the shipping address will belong to the hacker and not the card holder).
Fraudsters opening up shell companies for the purposes of money laundering isn’t really unheard of. This is particularly dangerous in the real estate industry where large sums of money are at stake in each and every transaction taking place. If the customer tries to make a payment from an offshore account, this is all the more reason to raise your suspicions. In fact, most of the countries now require some form of ID verification to take place in all transactions having something to do with purchasing real estate. Of course, this is only an example; more likely than not, your government requires ID verification for other types of businesses as well, so it’s best to check your local laws and regulations to make sure that all the legal requirements are satisfied.
Fraud can sometimes be inevitable despite your best efforts to prevent it, but the vast majority of fraudulent orders can be avoided by having the appropriate security measures in check, with identity verification being one of the most important ones in your arsenal. Have you implemented it yet?